“Ambitious investments in production capacity and R&D (Research & Development) will allow Daikin Europe to expand market and product leadership," says Patrick Crombez, General Manager Heating and Renewables at Daikin Europe.
By 2030, 4 million heat pumps will be installed each year, representing an annual growth rate (CAGR) of 20 %. Copyrights Daikin Europe
Brussels, November 2021 – Market leader Daikin Europe sees an inflection point in the European hydronic heat pump market, with growth rates anticipated to increase from 10 % to 20 % CAGR1. This will lead to annual heat pump installations of 4 million heat pumps by 2030, up from 1 million in 2021. Daikin Europe is responding by investing in production and innovation capacity, warehousing and logistics and increased training for installers and service technicians across the EMEA2 region.
“Switching our heating systems to heat pumps represents a historical transformation to low-carbon heating, with benefits for the climate and for healthier living environments. We are proud to lead this transformation in Europe”, says Crombez. Daikin Europe’s business unit Heating & Renewables is growing fast and – as the European market leader in this category – the Japanese brand is outperforming the European heat pump category growth. “2021 has been a turning point for our heat pump business. Consumers and policy makers have never been more eager to decarbonize heating systems”, he continues.
Annual growth rate (CAGR) of 20 % expected
Over the past decade, the European market for heat pumps has grown at a strong pace with an annual growth rate of 10 % (CAGR) from 2011 to 2020, resulting in the expected installation of 1 million heat pumps in 2021. In the coming years, Daikin – in line with other industry experts – anticipates a sharp acceleration in heat pump adoption: By 2030, 4 million heat pumps will be installed each year, representing an annual growth rate (CAGR) of 20 %. At that point, 1 out of 3 heating systems installed will be a heat pump up from 1 out of 10 in 2020. While this represents steep growth compared to recent years, Daikin Europe considers this the minimum to ensure a move to a decarbonized residential heating market in Europe.
Patrick Crombez, General Manager Daikin Europe, Copyrights Daikin
“From all available data, it is clear that heat pump adoption is hitting an inflection point this year and the already robust growth of the category will only accelerate”, concludes Crombez. A key driver for this growth has been the introduction of legislation governing new builds in many European countries, ranging from general regulations in France setting a new minimum standard for thermal insulation of dwellings to a ban on combustion boilers in the Netherlands.
Carl Lievens, Managing Director Daikin Central Europe, Copyrights Daikin
Additionally, incentives have successfully increased the appeal of heat pumps in the replacement and renovation market. "In most of our 16 markets in Central and Eastern Europe attractive subsidies are available. We see them as key elements in order to motivate especially home owners to stop the use of fossil fuels which is still very common for residential buildings in our region”, says Carl Lievens, Managing Director of Daikin Central Europe. At the same time, heat pump technology has evolved to make heat pumps an attractive option: the arrival of high temperature heat pumps means existing fossil fuel boilers can be replaced without the need to update or modify existing radiators.
Daikin Europe invests in production capacity and innovation
In the coming years market leader Daikin intends to more than triple its European heating production and expects their heating business to become one of the key pillars of Daikin’s revenue by 2025. Today, 5 of 14 Daikin’s EMEA2 factories are dedicated to heat pump production. All Daikin heat pumps sold in Europe are developed and produced in Europe, with main Daikin factories in Germany, Belgium and the Czech Republic. A recently announced investment plan of 840 million Euro for the next 5 years includes a sizable amount allocated to heat pumps. Crombez notes: “This will allow us to expand our European market leadership.”
Part of the investment aims to expand production capacity to keep up with demand. Another area is the planned construction of a cutting-edge development complex European Development Center (EDC) in Ghent, Belgium, allowing Daikin to strengthen its leadership in innovation and supporting a faster and wider development of heat pumps. The EDC complex represents an investment of 140 million Euro, will offer 380 jobs locally and will also function as the Daikin global centre for heating product development.
Daikin's European Development Center in Ghent will offer 380 jobs, Copyrights Daikin Europe
Expansion of European warehousing, training and deliveries to support transition to decarbonized heating
In 2021, production of Daikin Europe heat pumps will amount to 1.5 million units (covering residential, commercial and industrial hydronic heat pumps produced within the EU). It currently handles some 71,000 deliveries per day from its 30 warehouses all over Europe, and it is ready to scale this to meet the demand. Crombez comments: “In the next few years, we will increase our number of warehouses to allow us to reduce delivery distance to our customers. Our integrated stock and warehouse management approach allows us to move stock faster, offer better service and lower logistics costs.”
New technology also needs new skills. Therefore Daikin Europe offers support and training to installers in 54 training centers across Europe, 9 of them are located in the Daikin Central Europe region. Training ranges from starter courses on installation of heat pumps and direct expansion technology, to advanced troubleshooting courses and service controls on new products. “Despite the difficult conditions due to COVID-19, we doubled the number of trainees of our physical or online trainings in 2020. Investments like these strengthen our existing production and distribution network and allow us to look forward to the next decade with confidence and excitement”, is Crombez convinced.
Supporting a historical transition
The investments and growth plans of Daikin Europe Heating and Renewables fit into its vision of decarbonizing residential heating throughout Europe. As fossil fuel-based residential heating is a major contributor to greenhouse gas emissions, this transformation will support Europe to achieve its ambitious emissions reduction targets for 2030.
30 Daikin warehouses all over Europe, Copyrights Daikin Europe
Patrick Crombez states: “The coming years will be pivotal in decarbonizing the heating of residential and commercial buildings. It's a truly historical transition that will contribute to a stable climate, safer and healthier homes, and more affordable energy bills. We could not be more excited to take the lead in this transition in Europe.”
1CAGR = cross annual growth rate
2EMEA = Europe, Middle East, Africa
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Daikin Airconditioning Central Europe
Daikin Airconditioning Central Europe was founded in 1999 with its headquarters in Vienna, Austria. The company’s portfolio comprises products and solutions for heating, cooling, ventilation, air conditioning and refrigeration. More than 450 professionals are in charge of pre-sales, sales and after-sales-services in 16 countries across Central and Eastern Europe in Austria, Albania, Bosnia & Herzegovina, Bulgaria, Croatia, Czech Republic, Hungary, Kosovo, Montenegro, North Macedonia, Moldavia, Poland, Romania, Serbia, Slovakia and Slovenia.
Daikin Europe N.V.
Daikin Europe N.V., Daikin Central Europe’s mother company, is a major European producer of air conditioners, heat pumps and refrigeration equipment, with approximately 10,000 people employed throughout Europe and 14 major manufacturing facilities based in Belgium, the Czech Republic, Germany, Italy, Turkey, Austria and the UK. Globally, Daikin is renowned for its pioneering approach to product development and the unrivalled quality and versatility of its integrated solutions. With more than 90 years‘ experience in the design and manufacture of heating and cooling technologies, Daikin is a market leader in heat pump technology. Daikin VRV and Daikin Altherma are the most sold heat pump systems in Europe, with over 500,000 systems delivered to date.
Doris Passler, Corporate Communications Daikin Central Europe
T.: +43 664 24 56 444
Daikin Airconditioning Central Europe HandelsgmbH
1230 Vienna, Austria
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