China’s Home Appliance Industry Leads the Global Market with Smart Innovations
Home appliances have become an integral part of our daily lives, with almost every household relying on them. Over the years, the home appliance industry in China has undergone a remarkable transformation, from traditional appliances to the emergence of smart appliances. This shift has been driven by market demand and advancements in technology. China is now leading the global trend in home appliance consumption with its innovative approach.
Smart home appliances have gained popularity in recent years, allowing users to control their door locks, indoor lamps, air conditioners, TVs, and curtains through their mobile phones. Once scenes from science fiction movies, these features have become a reality for ordinary people. From refrigerators that pop up automatically to range hoods that work synchronously, and ovens that adjust temperature automatically, to washing machines that detect clothes’ weight and material, the convenience and efficiency of smart appliances are reshaping households.
By 2022, the revenue of China’s home appliance industry is projected to reach a new high of 1.75 trillion yuan, with a significant proportion coming from smart appliances. The interconnection of mobile and home appliances terminals has provided more than one billion ordinary people with a sense of gain and convenience, allowing them to transform their lifestyles. Chinese companies are leading the way in exploring smart home appliances, including demand mining, technological advancements, and the entire industrial chain. China has established a prominent position in this market.
Chinese companies are not only leading in specific categories and individual brands but also dominating most categories in terms of brand preference among Chinese consumers. In an evaluation conducted by the China Household Electrical Appliances Research Institute, domestic brands were favored by consumers in almost all categories. Chinese brands dominated the top ten brands in air conditioners, refrigerators, washing machines, and water storage water heaters.
This strong preference for domestic brands is attributed to Chinese companies’ deeper understanding of local consumers’ pain points and needs. They have developed products that cater to specific requirements, such as air conditioners with no sense of wind for enhanced comfort or bedroom air conditioners designed to suit sleeping conditions. Chinese companies’ ability to compete with foreign brands in the domestic market is a testament to their success.
In recent years, Chinese home appliance companies have gained global recognition, with industry leaders like Haier, Midea, Gree, and Xiaomi ranking among the Fortune Global 500. Many other companies within the home appliance industry chain have also emerged as champions in their respective fields. These companies contribute to the industry’s vitality by offering personalized products and components within a favorable industrial ecology. China’s home appliance industry is on a continuous rise.
In 2022, the home appliance industry in China is expected to generate a profit of 141.8 billion yuan, marking a 19.9% year-on-year increase. China’s complete industrial chain, strong industrial ecology, and ample opportunities for small and medium-sized enterprises have contributed to this growth. The industry’s focus on research and development, evident from the increasing number of authorized patents, has also fueled technological innovation. China’s home appliance industry’s perfect standard system and establishment of national standards have positioned it as a global leader.
One notable example of China’s innovation is Haier’s approach to the refrigerator industry. Haier introduced the IEC international fresh-keeping standard, changing the evaluation dimension of refrigerators. This standard has been adopted by more than 20 countries and has become a reference for global users in purchasing refrigerators. It exemplifies China’s commitment to pushing the industry forward.
While enterprises play a crucial role in driving technological advancements, the involvement of national forces is equally important, particularly in fields that face technical challenges. In 2016, the establishment of the National High-end Intelligent Household Appliances Innovation Center marked the government’s commitment to promoting innovation in the home appliance industry. This center aims to provide a platform for collaboration and further development, propelling China’s home appliances into a new era of growth.
The home appliance industry holds a pivotal position in the manufacturing sector, with China accounting for 38% of the world‘s home appliance trade share—the largest globally. To maintain its leadership and conquer the global market, China must continue to invest in research and development, pursue original innovation, and embrace greater challenges. The establishment of the National High-end Intelligent Household Appliances Innovation Center in 2021 highlights the government’s recognition of the industry’s potential and commitment to supporting its growth.
Chinese home appliance companies have successfully transformed from followers to leaders, and they now face the challenge of maintaining their innovative edge. As China’s home appliance industry moves from being a big player to a strong global force, collaboration between enterprises and government support will be vital in sustaining its growth and global dominance.