Automotive HVAC System Market 2025 Accelerating Toward USD 104.92B with 6.65% CAGR, EV Compatibility & AI Integration

According to Towards Automotive consultants, the global automotive HVAC system market is projected to reach approximately USD 104.92 billion by 2034, increasing from USD 54.65 billion in 2024, at a CAGR of 6.65% during the forecast period 2025 to 2034.

Ottawa, July 28, 2025 (GLOBE NEWSWIRE) -- The global automotive HVAC system market size stood at USD 58.33 billion in 2025 and is projected to reach USD 104.92 billion by 2034, according to a study published by Towards Automotive, a sister firm of Precedence Research.

The automotive HVAC system market is growing these days due to the growing automotive industry globally. Hence, enhancing the passenger and driver’s comfort aids the growth of the automotive HVAC system market.

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Key Highlights of the Automotive HVAC System Market

By region, Asia Pacific dominated the automotive HVAC system market due to increasing automotive production and higher adoption of EVs in the region.
By region, Europe is expected to grow in the foreseen period due to high demand for luxury vehicle services and to follow the strict emission regulations of the European government.
By vehicle type, the passenger car segment dominated the automotive HVAC system market due to its high demand for luxury services by automotive consumers.
By technology, the automatic segment dominated the automotive HVAC system market due to high demand for automatic HVAC systems, which are helpful in managing emissions, along with ensuring the comfort of passengers.

Market Overview & Potential:

Today, the vehicle production has observed a rapid increase globally. Hence, it has become vital for the automotive industry to ensure the passengers’ and drivers’ comfort to maintain the spike in the market. Hence, the automotive HVAC system market plays a vital role in the industry’s growth. The segment is essential as the automotive companies have to ensure the passenger and driver’s comfort, along with managing various other responsibilities such as maintaining the temperature inside the vehicle, maintaining sustainability, and maintaining the vehicle’s efficiency and performance as well.

Hence, the segment has a huge role to play in the market’s growth. Improving technology, such as smart sensors, enhanced air purification systems, and climate control features, has helped the growth of the automotive HVAC system market. The advanced technology helps the automotive industry manage the passenger and driver’s comfort, along with improving the vehicle’s performance as well.

The use of HVAC systems in electric vehicles is also a challenge for the market. Hence, under such circumstances, the advanced technology has helped the industry to manage an ideal balance between heating and cooling of the battery to manage the HVAC system along with the performance of the EV.

What are Latest Trends in Automotive HVAC System Market

The advanced climate control systems are helping the growth of the automotive HVAC system market by helping the system manage the temperature inside the vehicle, enhancing the comfort of the people inside.
Advanced technology in the form of IoT, AI, and smart sensors also helps the HVAC systems manage the temperature as per the climate, along with enhanced connectivity features, making it a smooth journey for the passengers.
Advanced features provided by the automotive industry these days, such as voice controls, touchless controls, and various other automated systems that lower the manual involvement, are also helping the growth of the automotive HVAC system market.
The use of energy-efficient components and eco-friendly refrigerants helps the automotive industry to lower its carbon footprint and manage sustainability as well. Hence, such precautions also aid the industry’s growth.

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Market Dynamics

Drivers

What are the growth drivers of the Automotive HVAC System Market?

Multiple factors today aid the growth of the automotive HVAC system market. Rising demand for passengers’ and drivers’ comfort is helping the growth of the market. Maintaining an ideal temperature inside the vehicle, along with adjusting sustainability factors and overall performance of the vehicle, is possible with the help of an HVAC system powered with advanced technological features to manage multiple tasks at the same time.

The advanced technology also helps to manage the system in EV by maintaining an ideal balance between the cooling and heating of the battery to maintain the efficiency of the vehicle. Alignment of all the features smoothly aids the growth of the automotive HVAC system market.

Challenge

High Manufacturing and Maintenance Costs Obstructing the Market’s Growth

The high costs involved in manufacturing and maintaining advanced HVAC systems act as a barrier in the automotive HVAC system market. The advanced HVAC system, loaded with features to enhance the driver’s and passenger’s comfort, may not be the cup of tea for the automobile industry manufacturing the low-cost car segment.

Hence, such issues may act as an obstruction to the market’s growth. Managing the advanced features of the latest HVAC systems requires timely maintenance as well. The high costs involved in maintaining the system, along with its repair in case of any breakdowns, are another issue in the growth of the market.

Opportunity

Use of Intelligent Climate Control Systems Helping the Growth of the Automotive HVAC System Market

Smart and technologically advanced HVAC systems are creating a huge opportunity for the growth of the market. The HVAC industry today understands the importance of technology and smart features essential for passengers’ and drivers’ comfort. Hence, the use of such smart systems by the automotive industry is helping the growth of the market.

Such systems help to analyze the climate and adjust the temperature inside the car to ensure the comfort of the passengers and the driver. Such systems also help to lower the manual interaction of the driver, helping the driver enhance their safety and improve concentration while driving. Hence, such technologically advanced features help the growth of the market in the foreseen period.

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Segmental Analysis

By Vehicle Type

The passenger car segment dominated the automotive HVAC system market due to the segment’s demand in the automotive industry. Consumers prefer to own a passenger car to avoid public transport. Hence, the segment’s growth is high in the automobile industry. With the growing rate of the segment, the automobile industry also ensures to look after the passengers’ and drivers’ comfort as well.

Hence, the HVAC industry today ensures to manufacture smart HVAC systems helpful to ensure the passengers' comfort along with maintaining sustainability factors without any compromise in the vehicle’s performance.

The commercial vehicle segment, involving light commercial vehicles and heavy commercial vehicles, is expected to grow in the foreseeable period. The government today ensures that commercial vehicles have an advanced and smart HVAC system for comfortable long hauls and makes it easy for drivers to drive safely for long journeys. A proper and efficient air conditioning system with lower manual involvement helps to ensure the driver’s safety and lowers the chances of accidents.

Hence, the segment plays a vital role in the growth of the automotive HVAC system market in the expected timeframe. Governments globally are paying attention to ensure an efficient HVAC system in commercial vehicles to ensure drivers’ comfort and safety, along with maintaining the overall performance of the vehicle.

By Technology Type

The automatic segment dominated the automotive HVAC system market due to its ease factor, helping the driver lower manual involvement. A smart HVAC system allows the driver to adjust the temperature within the car on its own, as per the current climatic conditions.

Various other functions operating with the help of AI and sensors attached to the system help to lower the manual involvement and automate each function as per the convenience of the passengers and the driver. Hence, the segment dominated the automotive HVAC system market, helping in enhancing the driver’s safety as well.

The manual segment is observed to grow at a notable rate in the foreseen period due to the ease it provides to the driver to adjust the settings accordingly and change them as well. The drivers who are unable to adapt to the automatic HCAC system and find it complicated prefer a manual HVAC system to adjust the settings. It allows them to change the air conditioning and various other setting options as per their convenience. It helps them to focus while driving and is also helpful for long hauls.

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Regional Insights

Which Region Dominated the Automotive HVAC System Market in 2024?

Asia Pacific dominated the automotive HVAC system market due to multiple reasons, such as the rising automobile industry, higher adoption of EVs, and introduction of advanced technology in HVAC manufacturing. Higher production of automobiles in countries like India, China, and Japan, along with rapid urbanization and improving standard of living, is also helping the growth of the market in the region. Government regulations on emission control and maintaining sustainability have led to higher adoption of EVs in the region. Hence, it has also helped in the growth of the automotive HVAC system market in the region.

What to Expect from European Countries in Automotive HVAC System Market?

Europe is expected to grow at a notable rate in the forecast period due to strict emission rules laid by the European government. Hence, higher adoption of EVs is also observed in the region, further helping the growth of the automotive HVAC system market.

High demand for the premium and luxury vehicle segment with enhanced consumer comfort is another major driver in the growth of the market in the region. Focus on maintaining air quality and health is also helping the growth of the market by introducing smart HVAC systems, which are helpful to maintain sustainability, along with ensuring passenger comfort.

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Recent Developments in the Automotive HVAC System Market

In July 2025, Nissens Automotive announced the release of its 868 new part numbers. The part numbers are exclusive to the company’s North American product portfolio. The portfolio involves AC service kits, compressors, and other components.
In August 2024, Hanon Systems, a thermal management solutions company, announced the development of the world’s first 4th-generation heat pump system for EVs. The company’s main aim was to enhance the driving range of EVs and to improve the energy efficiency.

Top Companies in the Automotive HVAC System Market

Denso Corporation
Valeo
Brose Fahrzeugteile
Eberspächer Gruppe
MAHLE GmbH
Hanon Systems
Sanden Holdings Corporation
Calsonic Kansei Corporation
Keihin Corporation
Mitsubishi Heavy Industries

Market Segmentations in the Automotive HVAC System Market

By Technology

Manual
Automatic

By Vehicle

Passenger Cars
LCVs
HCVs

By Region

North America
Latin America
Europe
Asia Pacific
The Middle East and Africa

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