AC makers set to hike prices to offset rising input costs; expect high double-digit growth this year

New Delhi: Leading AC manufacturers are betting on high double-digit growth this year even as they are firming up plans to increase prices of residential air conditioners by 5 to 8 per cent before the crucial summer season starts.

Leading players such as - Voltas, Daikin, LG, Panasonic, Haier, Blue Star and Samsung - are expecting a high double-digit growth, as they are betting on pent-up demand, sweltering summer and continuance of work from home, which will create demand for additional cooling products.

This season, several makers have introduced health and hygiene features in their range of ACs, claiming to protect their customers from the virus amid the pandemic. They are also providing no-cost EMI, cashback and easy accessibility to boost sales.

Daikin Airconditioning is going to increase the prices by 3 to 5 per cent this month as prices of metals and compressor, which are largely imported, have gone up.

"It will have some impact on the sales but the pent-up demand is there and summers would be hot this year. We are expecting that even if there is some price increase, demand would be there," Daikin Airconditioning India MD & CEO Kanwal Jeet Jawa told PTI.

Panasonic, which is having "robust sales" across regions, primarily helped by the pent-up demand from last year, is also going for a price increase and expects a high double-digit growth this season.

"We are looking at market trends and plan to raise prices of ACs in the range of 6-8 per cent while refrigerators will see an increase in the range of 3 to 4 per cent. This is due to the rise in production cost due to the increasing cost of commodities in the last few months, said Panasonic India and South Asia President and CEO Manish Sharma.

He further said: "For the last 3-4 months, we are witnessing a 25 per cent growth in air conditioners and are expecting the trend to continue this season too. Tata group firm Voltas, a leading player in the segment, has already increased the prices.

"We have already implemented a price hike in the AC category. Even though the recent increase in prices of raw materials have translated into price hikes for a variety of white goods, we remain optimistic about consumer sentiments, due to pent-up demand and a buoyant summer," said Voltas Managing Director & CEO Pradeep Bakshi.

Blue Star, which has already increased prices from 5 to 8 per cent in January and would again increase by around 3 per cent from April. Despite that, the company expects around 30 per cent growth this season in comparison to 2019, said Blue Star Managing Director B Thiagarajan.