Building Automation Systems Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Building Automation Systems Market Analysis

The Building Automation Systems Market is expected to reach a value of USD 277.68 billion in five years, registering a CAGR of 11.7% over the forecast period. A building automation system (BAS), also referred to as a building control system or a building management system, is a system that controls several electric, electronic, and mechanical systems throughout a building. The market report tracks the revenue accrued by the companies through the sale of building automation solutions worldwide. Components like building management systems, lighting controls, fire detection, HVAC controls, and security systems are included in the scope of the study and span across end users like residential and commercial.

• The global market for building automation systems has been driven by the increased popularity of the Internet of Things and rising security concerns. According to Cisco's Annual Internet Report, by the next year, nearly 30 billion network-connected devices and connections are expected to exist, increasing from 18.4 billion in 2018. IoT devices are expected to account for 50% (14.7 billion) of all networked devices by 2023, compared to 33% (6.1 billion) in 2018.
• According to the US Department of Energy, buildings are the single largest energy-consuming sector of the US economy. They account for approximately 75% of the nation's electricity use and 40% of its total energy demand. The International Energy Agency states that to hit global net-zero targets, all new buildings and 20% of existing buildings must be zero-carbon as soon as 2030.
• According to a report published in Proceedings of the National Academy of Sciences, in the next 50 years, 30% of the world's estimated population is expected to reside in regions where the average temperature is above 29°C due to climate change-related rapid temperature rise and population expansion. Currently, this climate only exists on less than 1% of the Earth's land surface, mainly in the hottest regions of the Sahara desert. But by 2070, these temperatures are expected to be present across about a fifth of the planet's terrestrial surface.
• With the growth of technology, smart buildings are growing more and more complex, requiring quicker follow-up looks via retro-commissioning. Adding to that, the risks associated with sustained operational integrity are also mounting.​ Hence, the demand for comprehensive building automation systems is expected to spike. It is very important to establish the necessary communication between the system providers/designers and owners of the buildings to understand the functioning of the building.​
• With the COVID-19 outbreak, most commercial and industrial construction projects started at a slower pace, while some were canceled. Production lines at some HVAC manufacturers had to be put on hold for several weeks, and installers saw their new installation projects being limited by sanitary guidelines. However, in European countries such as Italy, AHU sales benefitted from the increased ventilation demand due to COVID-19.

Building Automation Systems Industry Segments

Building automation systems exhibit functions such as control of the building's environment, operating systems depending on the energy demand, and monitoring the system performance, based on which the systems produce sound alerts as required. Moreover, it centrally controls the building's heating, ventilation, and air conditioning (HVAC), electrical, lighting, shading, access control, security systems, and other interrelated systems.

Building automation systems (BASs) or building automation control systems exhibit functions such as control of the building's environment and operating systems (depending on the energy demand) and monitor the system performance, based on which the systems produce sound alerts as required. A BAS has related hardware and software for controlling and monitoring electrical systems, heating, ventilation, air-conditioning (HVAC), lighting control, security, and surveillance in buildings.

The report on the building automation systems market is segmented by component (hardware, software, services), end-user (residential, commercial, industrial), and geography (North America, Europe, Asia-Pacific, Latin America, and Middle East and Africa). The market sizing and forecasts are provided in terms of value (USD billion) for all the above segments.

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Building Automation Systems Market Trends

This section covers the major market trends shaping the Building Automation Systems Market according to our research experts:

Surge in Demand for HVAC Housing, Owing to Rapid Population Growth

• According to the United Nations, there were 2.5 billion people in the world in 1950. There are about 8 billion as of 2022. It also projects that there are expected to be 10.4 billion people living on earth by the end of the century. Moreover, the IEA estimates that, by 2050, up to 2.5 billion individuals in hot countries are expected to own an air conditioner. Even though they would also need air conditioning, 1.9 billion individuals may be left out of the equation. According to this prediction, air conditioners may be used by 75% of people in hot nations by 2050.
• According to the International Monetary Fund, in 2021, the total population of the United States was approximately 332.18 million inhabitants. Such a rise in the population is expected to increase the demand for the construction of new homes, which is expected to drive the HVAC segment. HVAC firms are manufacturing new products to increase their market shares and are looking to expand into new markets.
• For instance, in May 2022, Johnson Controls-Hitachi introduced a new Wall Mount indoor mini-split unit as the latest addition to its PRIMARY P300 line of high-efficiency, single-zone commercial mini-split systems. This ductless heating and cooling system was developed to address the particular requirements of small to medium-sized spaces, such as retail establishments, dining establishments, and educational facilities. The new wall mount unit is small and lightweight, and the entire series of Hitachi PRIMARY mini-split systems have several mounting possibilities, making installation for contractors easier. Its long pipe adds to the layout freedom, and an extensive capacity range ensures a system is precisely the right size for any application.
• There is a greater need for consumer air conditioning due to the rising temperatures during summer, the overpopulation of large cities, and people's busy schedules. There are mounting concerns in the Asia-Pacific region, where air-conditioning systems are becoming more prevalent, affordable, and essential than ever before. There used to be little reliable air conditioning, but there is now a great need. This implies that the consumer housing market must offer acceptable living circumstances during the height of summer.
• According to the United Nations, Asia's population will likely be around 4.68 billion on July 1, 2021. Asia is the most populated continent, with approximately 3.5 times as many people as Africa, which is second. Before reaching a high in 2055 with 5.3 billion inhabitants, Asia is expected to gain another 620 million people. Nearly a third of the world's population is found in Asia.

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