Chinese Air Conditioner Exports Surge Amid European Heatwave... 43% Increase in First Half

As Europe continues to be gripped by heatwaves, demand for air conditioners is surging, prompting Chinese manufacturers to accelerate their entry into the market. However, environmental and power grid regulations, as well as trade frictions, are cited as potential obstacles to further growth.

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On August 18 (local time), Bloomberg News, citing data from market research firm Euromonitor International, reported that Chinese companies account for two-thirds of the global air conditioner market. Growth, in particular, has been rapid in Europe. According to Chinese customs data, China’s exports of air conditioners to the European Union (EU) in the first half of this year totaled $3.8 billion, representing an increase of 43 percent compared to the same period last year.

Chinese Air Conditioner Sales in Europe Up 43% Year-on-Year Amid Heatwave

The growth rates among individual companies are also steep. Orders from Europe for Chinese home appliance company TCL rose by more than 67 percent in the first half of the year compared to the same period last year, while sales of portable air conditioners increased by over 90 percent. Haier’s sales in France, Germany, and the United Kingdom doubled in June, and Midea’s air conditioner sales in four major European markets also climbed by more than 70 percent in the first half of the year.

The overseas expansion by Chinese air conditioner manufacturers reflects their pursuit of new growth engines amid a saturated domestic market. In 1995, there were, on average, only eight air conditioners per 100 households in Chinese cities; today, that figure has soared to 176 units per 100 households, indicating that the domestic market has essentially reached saturation.

Notably, Chinese companies, having accumulated technology, expertise, and capital through supplying to global companies in the past, are now directly entering overseas markets with their own brands. Eva Pan, founder of Labatech, a consulting firm advising on Chinese firms’ overseas expansion, stated, “They are considering ways to move higher up the value chain and build their own brands.”

Government policies encouraging overseas expansion have also supported these companies’ market growth. Chinese air conditioner makers are leveraging algorithms and sensor technology to enhance local competitiveness. For example, they have developed features that predict user temperature preferences and lifestyle patterns, or automatically turn off air conditioning in unoccupied spaces. Euromonitor analyst Veronika Kandusova remarked, “Chinese air conditioner manufacturers are moving beyond simple exports and into the stage of building brands tailored to local markets.”

Developing products suited to local conditions has also contributed to their efforts in Europe. Europe is a challenging market due to the abundance of older buildings and strict regulations on building preservation, which make installing air conditioners difficult. Frequently, drilling exterior walls or installing outdoor units is restricted, and obtaining permits can take several months. For instance, Chinese home appliance company Midea has introduced the ‘PortaSplit,’ which can be installed without drilling through walls. This connects a small outdoor unit with an indoor cooling device, requires no professional installation, and, in most areas, does not require a separate permit.

Environmental, Power Grid Regulations and Trade Frictions Remain Obstacles

Despite these successes, Chinese companies still face several hurdles to maintain growth in Europe. Firstly, there are environmental regulations. Environmental groups point out that the high electricity consumption of air conditioners could, in the long run, worsen climate change and also deepen inequalities related to access to cooling facilities. The EU plans to strengthen regulations on fluorinated refrigerants, which have a greenhouse effect, starting in 2027. Most Chinese-made air conditioners currently use these refrigerants.

The strain on power grids is another concern. This summer, heatwaves have driven up electricity prices, and the increase in cooling demand has led to grid supply issues in some regions. Fabian Poswinkel, an analyst at the International Energy Agency (IEA), commented, “A rapid increase in air conditioner installations could place a significant burden on the power grids of some countries,” and added, “Governments may also respond by tightening regulations.”

Meanwhile, the EU’s growing trade deficit with China is another variable for Chinese air conditioner manufacturers. In the first quarter of this year, the EU’s trade deficit with China reached 98 billion euros, the highest since 2022, and there are increasing calls for additional tariffs on Chinese imports.

In the United States, the impact of tariffs is already evident. After the Trump Administration imposed tariffs of over 30 percent on air conditioners, China’s exports of air conditioners to the U.S. in the first half of 2025 fell by about 25 percent year-on-year.

Nevertheless, Chinese companies see the European market as a proving ground for boosting their global competitiveness and plan to maintain their aggressive strategy. They are aiming to understand local consumers’ needs, raise product quality, and ultimately increase Chinese brand awareness even in the premium market.

Wis Feng, head of overseas air conditioner sales at Haier, stated, “To become a major global player, you have to compete on the international stage. A big fish cannot emerge from a small pond.”

This content was produced with the assistance of AI translation services.