The VRF market is growing at around 10% to 12% when compared to the HVAC industry, which is growing at around 6% to 7%, said Moan Abraham, VP and GM for Air Conditioning at Hisense Middle East.
Abraham was talking during the launch of its new generation G+ high-ambient series of VRF systems at the Big 5 tradeshow and exhibition in Dubai.
He said that VRFs are occupying the chillier and the residential one-on-one splits' market space.
He said: "VRF in the residential market is growing exponentially. Earlier when apartments used three or four split ACs, now they use a mini VRF system. The VRF market is going to outgrow the chiller market in the Middle East region."
China-headquartered Hisense has a 20% market share in China, said Abraham. He said: "China is also dominating the VRF market, with VRF technology and the production."
Talking about the HVAC market in general, Abraham said: "The HVAC market is a growing industry in the Middle East. There is a housing shortage here. There is now going to be rebuilding in some countries. The housing demand drives the growth of residential AC market
"Another thing is the replacement market. ACs are battered by the high ambient temperatures they are operating in. So after 4 to 5 years, they need to be replaced. So there is a new build and there is a replacement market.
"In a mature market like US, the replacement market is 70 to 80% and the new build is 20 to 30%. Here, it is the opposite. In the MEA region, the market size for air conditioning is 8 million units, of which 7.2 million is produced and shipped from china into this region."
Citing some of the challenges facing the HVAC sector in the Middle East region, Abraham said: "The first challenge is customer satisfaction. We should be able to provide quick turn around service. This region can not afford to be without air conditioning.
"The second big challenge is the acceptance of Chinese brand. The third biggest challenge is the continuous change in regulations. Here, in the Middle east we have more than seven to eight regulatory bodies.
"So I guess what Gmark has done is a good initiative. Now, for safety of products we have Gmark, which makes the market uniform. For commercial ACs, the Gmark regulations will be coming.
"However, for the residential range, there is no unified regulation. If there is a unified regulation for this region, then it gives the manufacturers more flexibility to come up with more innovative products."