Major HVACR manufacturers across the Asia-Pacific region are accelerating local production of low global warming potential (GWP) refrigerants as national phase-down mandates tighten and cross-border supply chains face growing disruption. The shift-driven by intensifying Kigali Amendment commitments, updated national cooling policies, and a push to reduce import dependency-is reshaping commercial refrigerant procurement, retrofit timelines, and service network requirements throughout the region.
Background
Asia-Pacific currently accounts for more than 34.7% of the global low-GWP refrigerant market, making it the world's largest regional consumer, according to IMARC Group data from 2024. Rapid urbanization, expanding cold-chain infrastructure, and a large installed base of legacy systems running high-GWP refrigerants such as R22 and R410A reinforce the region's dominance-a combination that creates both regulatory pressure and a substantial retrofit opportunity.
The Kigali Amendment to the Montreal Protocol is compelling Asia-Pacific governments to translate climate commitments into national phase-down schedules, with regional targets calling for an 80-85% reduction in HFC consumption before 2045, according to Mordor Intelligence. Several markets have already moved from pledges to enforcement. Australia is tracking toward an 85% HFC decline by 2036, while China froze HFC production and consumption in 2024, according to Mordor Intelligence. India introduced a minimum seasonal energy efficiency ratio (ISEER) requirement of 3.5 for split air conditioning systems effective January 2025, accelerating adoption of R-32 and HFO blends, according to HVAC Insider. Malaysia's Ministry of Environment and Water has endorsed R32 as the preferred low-GWP alternative for new residential air conditioning, while Indonesia's National Cooling Action Plan promotes certified technician training alongside inverter-system incentives, according to BRG Building Solutions.
The Asia-Pacific commercial HVAC market was valued at USD 82 billion in 2025 and is projected to grow at a compound annual growth rate of 6.89% to reach USD 122.36 billion by 2031, according to Mordor Intelligence. Within that market, low-GWP alternatives are set to expand at an 8.17% CAGR, even as traditional HFC systems retained 54.20% market share in 2025, according to Mordor Intelligence.
Manufacturer Activity and Local Sourcing Commitments
The pivot toward regional production is most visible at the OEM level. Daikin Industries inaugurated a full-scale residential air conditioning factory in Indonesia with an annual capacity of 1.5 million units, all utilizing R32, to serve both the domestic market and the broader ASEAN export base, according to BRG Building Solutions. LG Electronics has invested in a new room air conditioner plant in West Java to expand ASEAN supply of inverter-based R32 systems, while Haier opened a new facility in Chonburi, Thailand, to serve regional production needs, according to BRG Building Solutions.
These investments reflect a broader industry consensus. By 2025, most leading brands operating in Southeast Asia had fully converted their inverter-type residential air conditioning portfolios to R32, according to BRG Building Solutions. R32 now holds over 70% market share in countries such as Japan and Thailand, according to HVAC Toolkit. China-based producers, including Zhejiang Juhua and Sanmei Chemical, represent significant R32 production capacity; China accounts for the vast majority of the Asia-Pacific region's dominant 76% share of the global R32 market, according to Intel Market Research.
The Asia-Pacific refrigerants market is projected to grow from USD 3.39 billion in 2025 to USD 4.72 billion by 2030, at a CAGR of 6.63%, according to MarketsandMarkets. HFO-based refrigerants are expected to be the fastest-growing category in the region through 2030, driven by progressively stringent emission standards and national phase-down programs, according to MarketsandMarkets. China has separately allocated CNY 50 billion to upgrade cold-chain systems using ammonia and CO₂ technologies, according to HVAC Insider.
Analysts note that concentrating production closer to end markets aims to reduce price volatility tied to raw material supply. China controls approximately 63% of global fluorspar reserves-a key feedstock for fluorochemical refrigerant production-and recent export restrictions have caused anhydrous HF prices to fluctuate by ±25% quarterly since 2022, according to 24 Chemical Research. Global R32 output currently meets only approximately 85% of demand, creating regional shortages during peak installation seasons, according to 24 Chemical Research.
Outlook
Expanding local manufacturing is expected to compress refrigerant lead times and support faster commercial retrofit cycles, but a persistent technician skills gap remains a critical constraint. A regional shortfall of certified technicians-estimated at 15,000 in Australia alone-is pushing wages up approximately 25% annually and stretching installation schedules, according to Mordor Intelligence. Current R32 certification programs cover only an estimated 35% of HVAC technicians in major markets, creating service capacity limitations, according to 24 Chemical Research. Indonesia's National Cooling Action Plan specifically ties inverter-system incentives to certified technician training for mildly flammable refrigerants, signaling that workforce development is now embedded in national policy frameworks.
OEMs and service networks across the region are expected to scale A2L refrigerant training programs-covering leak detection, recovery procedures, and updated installation standards-alongside further localization of production infrastructure. Analysts anticipate that regulatory milestones in China, India, and ASEAN markets will continue driving capital investment and product redesign cycles through 2030 and beyond.
