Home News Rains play spoilsport for AC industry

Rains play spoilsport for AC industry

First it was Corona outbreak followed by lockdown, timely arrival of Monsoon and then its extended stay – all have come in sequence to spoil the party for air conditioner industry this year. As a result, second quarter too was a dull one for the industry and sales were down by about 35% during the quarter. However, decline in sales was not uniform but varied from region to region.

Higher rains in AP and Telangana ensured that sales dip by more than 50% in South. Decline was also caused by delayed withdrawal of Monsoon in the region.  East too fared badly in terms of sales which declined almost 50% during the quarter. On the other hand, North and West fared relatively better and sales decline was not so steep. Its estimated that decline in sales in the region was 25-35%. However, price was surprisingly stable during the quarter which also saw lesser promotional schemes/offers.

Despite the adverse conditions prevailing in the market, Voltas maintained its leadership position, which was  made possible largely by increasing share of inverter ACs and higher warranty. Hitachi, Carrier, Blue Star and LG also maintained their strong footing, while Daikin ceded share in some regions. Lloyd continued to maintain its share in select Northern and Eastern markets. Samsung, Panasonic and Haier failed make much mark during these trying times. Due to down-trading by customers low-to-mid range categories saw better demand than premium categories. Mitsubishi and O’General continued to maintain their dominance in premium category.

Decline in demand would have been steeper but for the improved availability of consumer finance during the quarter. Share of consumer financing has recovered from 25-30% in summer season to 40-45% in second quarter.

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