After Samsung and Panasonic, Godrej to shelve window ACs by 2020

Business Tech
Window Air Conditioners are being phased out  by companies like Samsung, Panasonic and Godrej.

Bangalore, January 23, 2018Old air conditioners are flying out of the window, thanks to technology, and consumer preferences.

“Thanks to technological innovation, changing consumer preferences and pressure from the government to focus on energy efficient consumer goods, the demand for window ACs has seen a sharp decline over the last three years,” said Mr Kamal Nandi, Business Head & Executive Vice President of Godrej Appliances, told Softcopy.

This shift came after the Bureau of Energy Efficiency (BEE) in its 2016 ruling banned the saleof one-star ACs in the Indian market while also making it compulsory for companies to comply with energy rating rules for hi-end inverter ACs from 2018.

Ishan Jain, Project Manager of BEE said, “As a policymaker, I can say that the manufacturers have definitely expressed interest in creating energy efficient products which led us to change the entire labelling standard mechanism.”

Considering changes in climate and average increase of temperature in India, we switched over from EER (Energy Efficiency Ratio) to ISEER (Indian Seasonal Energy Efficiency Ratio) in labelling last year, added Mr Jain.
He stated that companies have no scope for innovation when it comes to window ACs and hence they are stopping the production.
The “India Air Conditioner Market Outlook-2022” report has stated that some companies like Samsung, LG and Panasonic have stopped the production of window ACs as there is no possibility for innovation and that the entire market is shifting towards split ACs.

The report further says that although AC penetration in India is still low, the market is expected to grow at a compound annual growth rate (CAGR) of 10 per cent over the next four years.
Godrej Appliances, a company that enjoys a 12 percent market share in energy efficient ACs in India, is planning to stop the production of window ACs by 2020 since only 5% of its revenue comes from the sale of window ACs whereas the lion’s share comes from splits, said  Mr Nandi.

He stated several reasons for this shift, one of them being the fact that there are no window inverter ACs in the market, whereas inverter split ACs are in high demand.
He added that since the windows ACs come with compressors, they tend to become noisy over time, something that doesn’t occur in a split AC.
Manjunath, a Bangalore based AC dealer working for Rao and Co Hvac Sales and Services Pvt Ltd. said  that they sell up to 300 units of split ACs every month, as compared to window ACs of which they sold three units in the last three years.

Even though the split ACs cost about Rs. 3000 more than the window ones of similar capacity, most people prefer the former, added Manjunath.
Some companies do not deal in window ACs at all. Kiran from Nugen Airsquare, an appliance store which only deals in Daikin ACs in Bangalore said  that they do not sell any window ACs as there is no demand.

However, window ACs are being bought in semi-urban areas. Abhay Anand, of Bureau of Market Research and Assessment said  that window ACs are preferred in semi-urban areas where the craze of installing ACs has just begun. In urban areas, he said, the demand for them is definitely declining.
What was once a luxury item is now becoming a necessity for Indians, however, with more focus on green energy, aesthetics and innovation, it is logical for companies to stop the production of window ACs added Manjunath.

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