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The building automation and control systems market size is forecast to increase by USD 31.11 billion at a CAGR of 8.71% between 2023 and 2028. The market is witnessing significant growth due to the increasing demand for energy efficiency and comfort in both commercial and residential buildings. Facility management systems incorporating safety alarms, security, access management, heating, ventilation, and air conditioning (HVAC) are becoming increasingly popular. Central computer systems with sensors, detectors, relays, and smart electronics are being used extensively to optimize energy usage and enhance occupant comfort. However, the high installation cost is a major challenge limiting market growth. The integration of advanced technologies such as the Internet of Things (IoT) and artificial intelligence (AI) is expected to drive market growth by providing real-time monitoring and automation capabilities.
Furthermore, the use of personnel assistants in residential buildings is also gaining traction, adding to the market's potential. Overall, the market is poised for growth, driven by the need for energy efficiency, comfort, and security solutions in office buildings and other structures.
The market is experiencing significant growth due to the increasing focus on energy consumption and operating cost reduction in real estate assets. Integrated systems that combine hardware and software solutions for HVAC control, lighting control, safety systems, and security access control are becoming increasingly popular. The market is driven by the adoption of energy-efficient buildings and the push for building sustainability, de-carbonization, and 5G technology integration. Electronic devices and software are the core components of building automation systems, enabling efficient management of energy consumption and resource utilization. Material type is an essential factor influencing the market's growth, with a shift towards the adoption of smart materials and sensors for enhanced functionality.
Furthermore, the market spans various industry verticals, including residential, hospitality, and commercial sectors. Air conditioning and heating systems are significant applications of building automation and control systems, with HVAC control systems being a key focus area. The market's growth is expected to continue as technology advances and the need for energy savings and safety features becomes increasingly important.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.
The commercial buildings segment is estimated to witness significant growth during the forecast period. The Building Automation and Control Systems (BACS) market is witnessing significant growth due to the increasing emphasis on energy management in commercial and industrial buildings. In emerging economies, the need to enhance energy efficiency is driving the adoption of BACS, particularly in the residential, commercial, and industrial segments. Government regulations and heightened awareness regarding energy efficiency are key factors fueling market expansion. Commercial buildings in various countries are implementing stage-1 automation solutions to ensure compliance with government regulations and boost operational efficiency. These systems integrate various building operations, enabling customizable automation solution software that caters to the unique requirements of each building.
Furthermore, BACS plays a crucial role in managing energy consumption in HVAC systems and energy systems, contributing to the green building concept. However, the increasing use of advanced technology in BACS also presents a challenge, as these systems are susceptible to cyberattacks and malware. Sanitization systems are being integrated into BACS to mitigate these risks and ensure secure operations. In summary, the market is experiencing strong growth due to the increasing importance of energy management and government regulations. Commercial buildings are adopting these systems to enhance operational efficiency and comply with regulations, while the integration of customizable automation solutions and energy management systems caters to diverse building requirements. Additionally, the integration of sanitization systems addresses the security concerns associated with advanced technology in BACS.
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The Commercial buildings segment was valued at USD 18.42 billion in 2018 and showed a gradual increase during the forecast period.
North America is estimated to contribute 30% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
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The market encompasses Energy Management Systems, Monitoring, and Sanitization systems for HVAC and Energy systems in the Residential, Commercial, and Industrial segments. The European Union's Revised Energy Performance of Buildings Directive (EU) 2018/844 mandates the implementation of BACS in all non-residential buildings by March 10, 2020. This regulation aims to address market inefficiencies and realize the full potential of BACS, resulting in substantial energy and CO2 savings, as well as improved user comfort and health. Cyberattacks and malware pose a significant threat to BACS operations, necessitating strong security measures. The European BACS market growth is anticipated to be driven by these regulatory mandates and the green building concept, which prioritizes energy efficiency and sustainability.
Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The demand for energy efficiency is the key driver of the market. Building Automation and Control Systems (BACS) are essential for managing energy consumption and reducing operating costs in both commercial and residential buildings. In the context of escalating utility bills, energy efficiency has become a priority for property owners and managers. The construction sector's growth, driven by urbanization and the need for safer and smarter infrastructure, necessitates the installation of integrated systems, including fire and safety control, surveillance, HVAC, and lighting. BACS enables remote monitoring and control of these systems, leading to significant energy savings. Moreover, the adoption of BACS is not limited to commercial buildings. Residential complexes are also embracing these solutions to enhance operational efficiency and reduce utility bills.
Furthermore, smart appliances and interconnected systems allow residents to regulate room temperature and lighting within their homes, contributing to energy savings. The International Energy Agency reports that the global energy consumption in buildings is expected to increase by 30% by 2050. Therefore, the growth in technology and the increasing focus on energy efficiency make BACS an indispensable solution for real estate assets. Semiconductor chips play a crucial role in the development and implementation of these systems, enabling advanced features and improved performance.
An increase in use of personnel assistant in residential buildings is the upcoming trend in the market. The market is witnessing significant growth due to the increasing emphasis on energy efficiency and reducing operating costs in various sectors, including real estate assets and the construction industry. The integration of semiconductor chips and advanced technologies like remote monitoring and energy management systems are key drivers for this market growth. The International Energy Agency reports that interconnected systems, such as smart appliances and urbanization, account for a substantial portion of global energy consumption.
Furthermore, these devices, which can be accessed through the Internet and receive voice commands, act as controllers for lighting systems, thermostats, and personal assistants, offering features like setting up alarms and taking notes. The rise of converting houses into smart homes is expected to continue, contributing to the market's growth.
The high installation cost is a key challenge affecting the market growth. The market is experiencing significant technology growth due to the increasing emphasis on energy efficiency and remote monitoring in real estate assets. Integrated systems that enable interconnected appliances and semiconductor chips are becoming increasingly popular, leading to reduced energy consumption and operating costs. According to the International Energy Agency, urbanization and the construction sector are major contributors to global energy consumption, implementing energy-efficient building automation systems a priority.
However, despite the numerous benefits, the highly-priced and variability of solutions may deter some end-users from installation. This could potentially hinder market growth during the forecast period. However, the integration of smart appliances and advanced technology in these systems is expected to offset these challenges and drive market revenue.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator's stage to the laggard's stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
ABB Ltd - The company offers energy-efficient, security, and control systems for homes and buildings. They manufacture and sell electrical products and solutions that are designed to provide safe, smart, and sustainable electrical flow from the substation to the socket.
The market research and growth report includes detailed analyses of the competitive landscape of the market and information about key companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market is witnessing significant growth due to the increasing focus on energy consumption and operating costs in real estate assets. Integrated systems that combine energy management, HVAC control, lighting control, security access control, and safety alarms are becoming increasingly popular. The construction sector is a major contributor to this market, driven by urbanization and the green building concept. The use of semiconductor chips, smart appliances, and 5G technology in building automation is expected to accelerate growth. Energy efficiency is a key factor driving the adoption of building automation systems. The International Energy Agency estimates that energy consumption in buildings accounts for nearly 40% of global energy use.
Moreover, energy management systems enable real-time monitoring and optimization of energy usage, leading to significant energy savings. The building automation market can be segmented by industry vertical into residential, commercial, and industrial. The commercial industry, which includes office buildings, shopping centers, public transportation hubs, airports, and train stations, is a major market for building automation systems. The residential segment is also growing due to the increasing popularity of smart homes. The market is characterized by the use of electronic devices, software, and hardware. Safety systems, including sanitization systems, are becoming increasingly important due to concerns over cyberattacks and malware attacks.
Furthermore, condition-based maintenance and repair are also key areas of focus for manufacturing companies in the building automation market. The market is expected to face challenges from supply chain disruptions and de-carbonization initiatives. However, the opportunities for business growth are significant, particularly in the areas of real-time monitoring, security systems, and energy-efficient buildings. The use of advanced technology such as sensors, detectors, relays, smart electronics, and central computer systems is expected to drive innovation in the market.
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Market Scope |
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Report Coverage |
Details |
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Page number |
171 |
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Base year |
2023 |
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Historic period |
2018-2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 8.71% |
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Market growth 2024-2028 |
USD 31.11 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
7.82 |
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Regional analysis |
Europe, North America, APAC, Middle East and Africa, and South America |
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Performing market contribution |
North America at 30% |
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Key countries |
US, UK, China, Germany, and Canada |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
ABB Ltd., Bajaj Electricals Ltd., BuildingLogiX, Emerson Electric Co., Evon Technologies Pvt. Ltd., FORESCOUT, Honeywell International Inc., IoEnergy Inc., Itron Inc., Johnson Controls International Plc., KMC Controls Inc., Legrand, Lutron Electronics Co. Inc., Mode Green Integrated Building Technology, OptergyA, PointGrab Inc., Robert Bosch GmbH, Rockwell Automation Inc., Schneider Electric SE, and Siemens AG |
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Market dynamics |
Parent market analysis, market growth inducers and obstacles, market forecast, fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, market condition analysis for the forecast period |
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Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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