Where’s China’s refrigerator industry going in 2023

Source: CHEAA-run China Appliance magazine

China’s refrigerator industry struggled in both domestic retail market and overseas market in 2022 under the influence of several disadvantaged factors at home and abroad such as the prevention and control of COVID-19, the fed rate hikes, the Russia-Ukraine conflict and the inflation.


National refrigerator output stood at 71.5886 million units from January to October 2022, down 3.26% YoY, according to National Bureau of Statistics. As to sales, the total sales of China’s refrigerators came to 69.834 million units from January to November 2022, down 11.9% YoY, according to ChinaIoL.com. It’s almost the steepest fall of China’s refrigerator sales in 30 years. In 2021, the numbers were 79.282 million units and a rise of 3.5% YoY.

The primary cause of the plunge is overseas market, once the major contributor to the fast growth of refrigerator industry in 2021. The outbreak of COVID-19 significantly boosted the stay-at-home demand of overseas consumers. This coupled with the stimulus policies of some countries, the shutdown of overseas factories and the disrupted overseas supply chains led to a surge of export volume as well as an upgrade of product mix of refrigerators from China. As a result, China’s refrigerator industry saw a fast growth of more than 25% in export for two consecutive years. In 2021, the export volume of refrigerators from China reached an all-time high, accounting for more than 50% of the total sales volume of refrigerators of the industry.

But the strong growth of overseas market in 2020-2021 was driven by many occasional factors that cannot sustain long term growth. With the production resumption of overseas factories and the rise of overseas inventory, the export of refrigerators from China started to slide from H2 2021. Entering 2022, it became even harder to sustain growth in overseas market with the outbreak of the Russia-Ukraine conflict and the demand shrinkage and downgrade of the once fast-growing European market despite the high inventory, weaker demand and fiscal subsidy cut of overseas market.

The hard-hit overseas market affected the export performance of refrigerators from China. From January to November 2022, the export volume of refrigerators with compressor from China stood at 31.9751 million units, down 20.67% YoY, and export value 5.454 billion USD, down 21.55% YoY, according to General Administration of Customs. China’s home appliance industry faced a fall in both export value and volume aside from a downgrade in product mix.

Domestic market

The domestic market has been relatively steady compared to the overseas market. From January to November 2022, omni channel retail sales volume of refrigerators stood at 28.23 million units, down 6% YoY, and sales value 86.8 billion Yuan, down 4.3% YoY, according to All View Cloud. After two years of strong growth at online channels, the online market of refrigerator industry saw a dive in both the growth rate of retail sales value and volume with only a slight growth made, while offline market saw a 20% fall in retail sales volume due to COVID lockdowns and dented spending willingness of consumers.

With the number of refrigerators per 100 households exceeding 100 in both urban and rural areas and a shrinkage of new demands due to the housing market contraction, industry players have been struggling to tap into replacement demand amid dented consumer confidence with efforts put into high-end products and lower tier markets, showing strong resilience.

Data from several sources show that, sales of refrigerators above 10,000RMB grew fast in both online and offline channels particularly the latter, accounting for 40% of the offline market by retail sales value. The upgrade in fresh keeping and odor removing technologies and the improvement of design empower the industry to go high-end and stimulate the replacement market. Besides, it’s worth noting that the industry did not wage price wars at the key promotion festivals of 2022 even on online channels, once the major battlefield of price wars.

The performance of lower tier market is also a highlight with the rise of disposable income of rural residents, the popularization of the Internet and the changes of consumption concept in rural areas. The market shows great vitality. Data from several sources show that lower tier market accounts for more than 30% by retail sales value.

The brand pattern remains steady with Haier, Midea and Hisense taking the lead in both domestic sales and overall sales.

The overall capacity of China’s refrigerator industry rises amid the sluggish market and the market concentration. As a rough estimate, the combined capacity of refrigerators within China has exceeded 150 million units in 2022, which points to a redundancy of 50%. Industry players in the second league will face severe survival tests.


The optimization of COVID-19 control measures is expected to inject vitality to the market. This, combined with policies to promote the consumption of green and smart home appliances and consumption upgrade, is expected to fuel the sales of refrigerators especially models above 10,000RMB in 2023. In a concentrated market pattern, refrigerator makers pin their hope on the high-end strategy as the upgrade of consumption concept, consumers’ pursuit of quality life and the improvement of living standards lay the ground for the growth of premium products. Premium refrigerators, the major driving force of the market now, are expected to keep the growing trend down the road.

While the recovery of consumption confidence drives up the replacement demands for premium products, rural market will also provide a boost of growth to refrigerator industry. With some development made in 2022, the lower tier market is expected to unleash greater potential in 2023 when the optimization of COVID prevention and control measures restores consumption confidence. I learn from many interviewees from refrigerator brands that county level market has become the core of lower tier market, and the demand for premium and smart refrigerators is rising there. Besides, the penetration rate of short video apps such as Douyin (the Chinese TikTok) and Kuaishou in rural areas gradually changes the consumption concept of rural consumers. Their demands for refrigerators and services have been upgrading.

Driven mostly by the replacement demands of the existing market in recent years, the refrigerator industry may embrace a surge of new demands when real estate market starts to thaw in 2023.

When it comes to overseas market, the international situation is still complicated. Despite that, there are opportunities such as the shutdown of some overseas factories amid unrest, the decline of some overseas brands and the brand establishment of domestic players such as Haier, Hisense and Midea at overseas market, which allows for further market expansion of Chinese brands at global market. The global expansion of China’s refrigerator industry will go on.

The overall growth rate of refrigerator output and sales of China is expected to go down from the double-digit growth to over 5% in 2023 in our estimation.