With the support of factors such as trade-in incentives and expanded coverage, the air conditioning market in 2025 appears particularly lively.

According to data from Aowei Cloud Network, following a double-digit growth in air conditioner production in March, the air conditioning industry continued to show strong growth in April 2025. Air conditioning companies are increasing production and stockpiling in a bid to achieve their sales targets for 2025. In terms of brands, the rising Xiaomi is engaging in close competition with traditional air conditioning giants, while clean appliance brand Chasing announced its entry into the air conditioning market, showcasing its two innovative air conditioner products recently. A fierce battle in the air conditioning market seems to be unfolding.

Strong growth in air conditioner production.

The air conditioning production data has always been an important indicator of industry development. According to Aowei Cloud Network, the total production of air conditioners in April reached 24.29 million units, a year-on-year increase of 11.8%. The domestic production scale reached 13.31 million units, with a year-on-year growth of 11.1%; the export production scale exceeded 10 million units, reaching 10.98 million units, with a year-on-year increase of 12.7%. Among them, the production growth rate of some mid-tier brands in April could be as high as 20%, while some emerging brands even exceeded a growth rate of 60%, significantly higher than the industry average.

Aowei Cloud Analysis believes that from the perspective of the distribution channel, the current inventory in the air conditioning industry is within a healthy range, with channels having sufficient buffer space and the market showing strong capacity to absorb products. From the cost perspective, the prices of raw materials for air conditioners, such as copper, are on the rise, making advance stockpiling an effective strategy for air conditioning manufacturers to cope with increasing costs.

In the domestic market, the continuation and expansion of the trade-in program in 2025, especially the increase in the maximum subsidy for consumers purchasing air conditioning products from 1 unit to 3 units, has generated significant expectations among various air conditioning brands for this year's market performance. According to data from Aowei Cloud Network, from January to February, the retail sales and volume of home appliances achieved steady growth in both online and offline channels, with offline market retail sales increasing by 10.2%. Among these, the sales of air conditioners in February grew by 15.05% online and 132.95% offline year-on-year.

In terms of overseas markets, the moderate recovery of the global economy has significantly boosted the demand for home appliances such as air conditioners, especially in emerging market countries where the demand for air conditioning equipment has seen explosive growth. On the other hand, as Chinese air conditioning companies continue to strengthen their efforts in technology research and development, product innovation, and manufacturing, the competitiveness of domestic air conditioners is continuously improving, further consolidating and expanding their share in the export market.

Industry insiders analyze that the 2025 government work report will prioritize expanding domestic demand and boosting consumption as the top task, with the support funds for trade-in programs being doubled to 300 billion yuan. Recently, a series of consumption-promoting policies have also been implemented intensively, and demand orders from overseas markets continue to grow. From a temperature perspective, the latest data from the National Meteorological Administration shows that since the spring equinox on March 20, temperatures in most parts of China have risen by 3 to 5 degrees Celsius compared to the average for the same period in previous years, with some areas even exceeding 30 degrees Celsius. Overall, the air conditioning market shows a positive trend.

"Burning hot"

The production of air conditioners continues to grow, while on the other hand, many air conditioning brands have been very active recently, making it quite bustling.

On March 18, Xiaomi Group released its financial report for the fiscal year 2024. The report shows that in 2024, Xiaomi Group's total revenue reached 365.9 billion yuan, a year-on-year increase of 35.0%; the adjusted net profit was 27.2 billion yuan, a year-on-year increase of 41.3%. Among them, the revenue from Xiaomi's home appliances grew by 56.4% year-on-year, with air conditioner shipments exceeding 6.8 million units, a year-on-year growth rate of over 50%.

On March 13, Lu Weibing, partner and president of Xiaomi Group, posted on Weibo that the sales of Mijia air conditioners will maintain a growth rate of over 50% this year, with a full-scale push into the high-end market and a continuous rise in ASP. The annual sales target for the open market is to rank third, aiming to become one of the top two air conditioning brands in the next five years! On the evening of February 27, Xiaomi held a launch event where several products were introduced, including the Mijia central air conditioning system, which is considered by the industry to directly target the core market of Gree Electric.

Lu Weibing stated that Xiaomi has basically caught up with traditional air conditioning technology, but its lead in smart technology is significant. He pointed out that over 70% of Xiaomi's users are connected online, whereas some brands have only a few percent, resulting in a nearly tenfold gap. Notably, Xiaomi's large appliance smart factory located in the Donghu High-tech Zone of Wuhan is accelerating its construction and is expected to start production by the end of the year, with large-scale mass production anticipated by 2026. Analysts believe that with the completion of the factory, Xiaomi's air conditioners will improve quality control over products and leverage a more competitive cost advantage, which will visibly impact the current market landscape for air conditioning.

Xiaomi's air conditioners are aggressively targeting traditional air conditioning giants, while on the other side, new "forces" in the air conditioning market are also making their entrance. At the recently held China Household Appliances and Consumer Electronics Expo (AWE2025), Tracmo Technology showcased two flagship air conditioning products—the Z-Wind three-level uniform fresh air conditioner and the X-Wind dual mechanical arm air conditioner—officially announcing its expansion from the smart cleaning sector to the major appliance market. Additionally, Tracmo Air Conditioners has reached a strategic cooperation agreement with JD Service+, under which JD Service+ will fully undertake the installation, debugging, maintenance, and servicing of Tracmo air conditioning products.

Analysts believe that compared to other air conditioning brands, ZhiMi's core technology, experience, and ecosystem will be its advantages. According to reports, both of ZhiMi's air conditioning models have received the innovation certification from Frost & Sullivan. The entry of this new force into the market will intensify competition in the air conditioning sector, while also creating a "catfish" effect, prompting the entire air conditioning industry to improve overall performance and user experience.

As the "new forces" steadily approach, traditional giants naturally will not remain indifferent. Overall, many large enterprises have been ramping up their sub-brands recently. Recently, Midea's sub-brand Hualing Air Conditioning announced that the profit margin of its Shenji series air conditioners would not exceed 1%. On the Gree side, Gree Electric's market director Zhu Lei stated that the Jinghong brand under Gree Electric is expanding from refrigerators to the air conditioning category. Analysts believe that compared to the main brand, sub-brands are more flexible in terms of pricing, service, and operations.

During last year's 618 shopping festival, the air conditioning market experienced a fierce price war. According to statistics from Aowei, in January and February 2025, the average price of air conditioning products in the online market dropped by 2.86% year-on-year, while the offline market saw a decrease of 2.49% year-on-year. It is expected that there will still be significant product price adjustments in March. The form in which the air conditioning battle will unfold in 2025 may soon be revealed by time.