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Shift to Alternative Refrigerant Revives Mature European Automotive OE HVAC Systems Market


March 2007
 Filed under: AUTOMOTIVE MANUFACTURING Car News | AUTOMOTIVE MANUFACTURING Headlines
LONDON, March 15/PRNewswire/ -- European Union (EU) legislation to phase out the existing R134a refrigerant is a key driver in the European automotive original equipment (OE) heating ventilation and air conditioning (HVAC) systems market. While R744 has been widely accepted as the alternative refrigerant for R134a and commercial launch is expected by 2009, its future will depend on the success of various alternatives currently being explored by refrigerant suppliers.

Frost & Sullivan finds that the European Automotive OE HVAC Market earned revenues of EUR5.06 billion in 2006 and estimates this to reach EUR9.81 billion in 2013.
"Following EU legislation to phase out the existing R134a refrigerant, R744 (commonly known as CO2) has been adopted as its replacement," notes Frost & Sullivan Research Analyst Roshan Devadoss. "In the meantime, Dupont and Honeywell have already developed alternative refrigerants that would comply with guidelines set by EU."

Honeywell's refrigerant, called H-fluid, has generated interest among both vehicle manufacturers and Tier 1 suppliers. It offers cooling efficiency and operating pressure similar to that of R134a while being comparatively more cost-effective.

A major challenge for the automotive HVAC industry will be the increase in the price of HVAC systems. The shift to alternative refrigerants will involve considerable re-engineering and re-designing of existing systems. The resultant costs incurred by suppliers will be reflected in higher prices for the systems.

"The EU's decision to opt for an alternative refrigerant will raise the cost of HVAC systems for suppliers," explains Mr Devadoss. "Existing infrastructure required to manufacture HVAC systems will need to accommodate changes to component design, resulting in higher cost outlays."

The increase in system prices is inevitable. However, suppliers are working towards cost-effective solutions that will address the concerns of vehicle manufacturers.

European Automotive Original Equipment (OE) Heating Ventilation and Air Conditioning (HVAC) Systems Markets is part of the Automotive & Transportation Subscription, which also includes research in the following markets: transmission technologies and features, European OE and aftermarket for CAF, strategic assessment and capability analysis of European suspension system suppliers. All research included in subscriptions provides detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. Interviews with the press are available.

Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies and the investment community by providing comprehensive industry coverage that reflects a unique global perspective, and combines ongoing analysis of markets, technologies, econometrics and demographics. For more information, visit http://www.frost.com

List of key words in this press release: European automotive original equipment heating ventilation and air conditioning systems,OE HVAC,R134a ,alternative refrigerant, R744

Source: Frost & Sullivan

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