Source of this article: Times Weekly Author: Qi Xin
In 2022, will the price of air conditioners continue to rise?
Recently, some small and medium-sized air conditioning manufacturers issued price increase notices. Guangdong Meibo Intelligent Environment Equipment Co., Ltd. (hereinafter referred to as "Meibo") and Jiangsu Xinke Electrical Appliance Co., Ltd. (hereinafter referred to as "XINKE") have successively announced that from January 1, 2022, the price of air conditioners will rise by 5%-8% and 3%-5% respectively.
"We received a price increase notice, and since January 1, the price has been increased, and each air conditioner has increased by 80 yuan." On January 7, the relevant person in charge of ST air conditioning told the Times Weekly reporter.
Not only that, on January 6, the Times Weekly reporter visited a store of Gome Electrical Appliances in Shanghai, and a number of sales staff in the store said that the prices of Gree and Mitsubishi air conditioners have risen, and Haier, Midea and other brands will soon be adjusted.
At present, Gree, Midea and Haier have won more than 70% of the market share, leaving little market space for small and medium-sized manufacturers. As prices rise, the bargaining power of these brands is limited, and the living space is further reduced.
Multiple rounds of price increases
"In May 2021, the price of air conditioners experienced a wave of increases. In July, the price of Gree rose by 10%, and after double twelve, it rose by 10%. A salesman at the above-mentioned Gome electrical appliance store told the Times Weekly reporter: "It is not only Gree that has raised prices, today (January 6) the price of Mitsubishi air conditioners rose by 10%. ”
Image source: Photo by a reporter from The Times Weekly
Two other salespeople at the store said that Midea and Haier will also raise prices around January 15.
On January 7, the Times Weekly reporter contacted Gree, Midea, and Haier respectively, and the staff of the United States said that they had not received the notice of price increase for the time being, and Gree and Haier had not replied.
According to media reports, in the notice issued by Meibo and ST, the price increase factors include a sharp increase in the price of raw materials. ST also highlighted the impact of energy consumption control on manufacturing costs.
On January 7, a reporter from the Times Weekly called Meibo, and the staff said that they were not clear about the price increase.
"The price increase is decided by the factory, and there is no way to explain the specific situation to us." We also rose in May last year. The person in charge of the above-mentioned ST air conditioning said.
"The price of air conditioners has indeed risen in 2021, because the price of raw materials has risen too much, and the raw materials such as plastics, copper, and iron used in air conditioning production are increasing in price, so the prices of various brands of air conditioners have to rise." The sales staff of the above-mentioned Gome store said.
In this regard, the manager of a store in Suning Tesco Shanghai also expressed the same view to the Times Weekly reporter. "The price of air conditioners has not dropped since the price increase in May last year, but the price of air conditioners in our shop is the same as that of double eleven and double twelve." The prices of raw materials used to produce air conditioners, such as copper, are rising. ”
In fact, raw material prices have recently shown a downward trend, but it will take some time to reach the end market. Kaiyuan Securities Research Report shows that the recent price of raw materials for home appliances has declined month-on-month, and it is optimistic that the cost of raw material prices will improve under the fall.
"From May 2021 to the present, the fundamental reason for the increase in the price of air conditioners is the increase in the price of raw materials. In fact, from 2020, the price of raw materials for air conditioning is rising. On January 7, Home appliance industry analyst Hong Shibin told the Times Weekly reporter: "But by the end of 2021, raw material prices have shown a stable state, and even a certain decline, so it is difficult to increase the price of air conditioners in 2022." ”
Hong Shibin believes that labor costs and market environment are not enough to support enterprises to raise prices again, but the export situation of air conditioners is different, and the price is related to overseas purchasing power and freight prices.
Small brands survive hard
The rise in the price of air conditioners will have less impact on large brands, but for small brands, it will be greatly affected. At present, gree, midea and other big-name air conditioning manufacturers occupy most of the market share, small brand air conditioning manufacturers have a hard time surviving.
According to the data of China Business Intelligence Network, from January to September 2021, the top three companies in the retail sales of the air-conditioning online market were Gree, Midea and Haier, with market shares of 31.2%, 30.4% and 10.9% respectively, and the market share of the three companies was as high as 72.5%; the top three companies in the offline market were Midea, Gree and Haier, with market shares of 35.6%, 33.3% and 14.6% respectively, and the three companies together won 83.5% of the market share.
In the recently released air-conditioning online and offline weekly express reports by Aowei Cloud Network, brands such as Meibo and ST are not included in the retail sales share statistics of TOP brands.
"Now there are more consumers who buy Gree and Midea, and small brands of air conditioners can't really be found." The sales staff of the above-mentioned Gome store sighed to the Times Weekly reporter: "For example, in the past, Chunlan air conditioner was very famous, louder than the brands of Gree and Midea, but then Chunlan air conditioner slowly declined." ”
The squeeze of large brands coupled with the increase in the price of raw materials, the survival of small brand air conditioner manufacturers is worrying. Meibo and ST's price increase may be the measures taken by the company to increase profits. The problem is that the premium power of small brand manufacturers is weak, and it is difficult for consumers to pay for price increases.
"The price increase will definitely have an impact on the sales of air conditioners, which makes the company face the problem of whether to sell scale or profit." If the price has been so low, the manufacturer may not have gross profit, which is lighter or heavier, the enterprise will perceive it in the process of operation. Hong Shibin said.
Not only that, with the decline of the real estate industry, the purchasing power of consumers has declined, and the current overall air conditioning market is in a downward trend. Home appliance giants such as Gree and Midea have diversified and expanded to find new markets. The financial strength of small and medium-sized air-conditioning manufacturers is limited, and it is difficult to invest in diversified development on a large scale in the short term, whether the price of air-conditioning increases or not, it seems that it is difficult to solve the development dilemma.