Core Insights - The air conditioning industry is experiencing significant growth due to the "old-for-new" national subsidy policy and extreme summer temperatures, particularly in the Northeast region of China [1][2] - Intense competition among major brands is evident as they vie for market share, leading to aggressive pricing strategies [1][6] - Online sales channels have become the dominant force in the air conditioning market, accounting for approximately 60% of total sales in the first half of the year [2][3] Market Dynamics - The Northeast market has become a battleground for air conditioning companies, with major brands like Xiaomi, Gree, and Midea mobilizing resources to meet demand [4][5] - Online sales of air conditioners reached 38.45 million units in the first half of the year, a 15.6% increase year-on-year, with online channels growing by 18% [2][3] - Offline channels still hold a significant share, contributing to 50.3% of total sales despite a lower volume share [3] Competitive Landscape - Major players like Gree, Midea, and Haier dominate the market, collectively holding nearly 70% of the retail volume and 73.6% of the retail value [5] - Xiaomi aims to become the third-largest air conditioning brand in China, targeting 10 million units shipped this year [5][6] - The price war has intensified, with low-end models seeing significant price reductions, making it challenging for new entrants to compete [7][8] Pricing Strategies - The average online price for Gree and Midea air conditioners has decreased by approximately 10% and 2% respectively, while Xiaomi's average price dropped by 20% [8] - The offline market shows a different trend, with Gree maintaining the highest average price at 4,770 yuan, despite a 4.5% decrease [8][9] - The competition in the low-end market is fierce, with prices for popular models dropping below 1,200 yuan [7] Future Outlook - The high temperatures in the Northeast are expected to provide a temporary boost to air conditioning sales, but overall growth may be limited due to the region's small market share [10][11] - Analysts predict a potential decline in sales volume by approximately 5.6% in the second half of the year, influenced by high inventory levels and previous strong demand [10][11] - The overall market is expected to maintain slight growth, but challenges remain due to high base effects and economic conditions [11]