We made our annual trip to the AHR Expo in Orlando to meet with past clients, reconnect with old friends, make new acquaintances and talk with leaders in the industry to gain valuable insights into the challenges and opportunities facing the HVAC industry in the year ahead. With record attendance (1,800+ exhibitors, 50,000+ attendees), AHR remains the premier event in the HVAC industry.
Here are a few of our key takeaways from the three day conference:
- State of HVAC 2025 – A keynote panel featuring leaders from ASHRAE, AHRI, and HARDI covered the A2L transition, evolving regulations, and workforce development. Interestingly, tariffs were mentioned only briefly (let’s “wait and see”), while previously hot topics like AI, supply chain disruption, and inflation were notably not discussed. Overall, the expert panel predicted 2025 as a year of continued transition and volatility due to the looming A2L regulatory changeover.
- A2L Transition – With new EPA refrigerant regulations and a drive toward sustainable design, exhibitors highlighted advancements in low-GWP refrigerants and high-efficiency systems. Early adopters like Daikin may see an advantage opportunity to recover or gain market share as 2025 unfolds. Most other manufacturers will likely go through growing pains of adapting to the new standards throughout this year. There were few concerns about a slowdown in regulatory tailwinds for the industry under the new administration, as A2L remains fully in motion, with many noting that rolling it back would be highly challenging.
- Efficiency at the Forefront – Electrification and decarbonization remain top industry priorities, driving transformation through rapid advancements in heat pump technology that enhance reliability and performance. While manufacturers continue to expand their heat pump offerings across both residential and commercial applications, there is growing adoption of hybrid systems that are designed to integrate with existing infrastructure. This continued adoption is accelerating the transition from legacy systems to newer technologies, with a goal of moving towards more stringent environmental goals.
- Contractor Preparedness and Education – On the service / contractor side, a common theme was the urgent need for HVAC service companies to adapt to new refrigerants and comply with evolving standards. There was a call for wholesale distributors and manufacturers to ramp up training and increase support for their contractor customer base, since only about 10% of the industry is fully prepared for upcoming regulatory shifts.
- Workforce Development Challenges – The HVAC sector faces a significant labor shortage and an employee “age misalignment,” prompting calls for innovative training programs and better recruitment strategies. Attendees stressed the importance of emphasizing the diverse opportunities within HVAC and highlighting the industry’s mission-critical role in tech-forward, innovative projects across residential, commercial, and industrial applications.
- Recent M&A Trends – The tone on the Expo floor was noticeably more optimistic about M&A compared to 2024, with many executives expressing enthusiasm for acquisitions as a means to supplement organic growth. In the manufacturing sector, OEMs have focused their recent efforts on acquisitions that focus on core growth themes like energy-efficient technologies, smart home integration and advanced controls. Meanwhile, in the distribution and services segments, consolidation remains active with strategic operators and private-equity backed portfolio companies pursuing acquisitions that expand geographic reach or diversify their service offerings.
We continue to be active across the HVAC landscape (equipment, distribution, service) and are proud of our commitment to the industry. If you would like to learn more about our experience, or if you are interested in exploring a transaction, please don’t hesitate to reach out to our HVAC team, led by Chris Reenock, Managing Director.
Contact Us
Whether you are actively considering an exit or just curious about options for the future, we would love to connect, learn more and truly understand your objectives. We are happy to share our insights and help explore strategies to maximize the value of your company and enhance the legacy of your business.
Chris Reenock
203-349-8376 (Direct)
917-334-1739 (Mobile)
CReenock@CarterMorse.com
Ramsey Goodrich
203-349-8375 (Direct)
203-554-2435 (Mobile)
RGoodrich@CarterMorse.com