Source: CHEAA-run China Appliance magazine

In 2024, China's refrigerator industry hit a plateau in its development, facing challenges including sluggish domestic market demand, severe technical competition pressure, and highly uncertain global markets.

Relevant retail data shows that, in the first half of 2024, the retail sales of refrigerators in China struggled to maintain the same level of the last year, even saw a slight decline. The performance of the "618" online promotion festival was one of the worst in history. The industry's shipment data also reveals a downward trend: from January to July, domestic refrigerator shipments declined by nearly 5% year-on-year.

With advanced technology but a sluggish domestic market, refrigerator companies are channeling more strategic resources into the steadily growing overseas market. Continuing the strong export momentum of 2023, China's refrigerator exports surged in 2024. In the first seven months of 2024, the ratio of exports to domestic shipments reached 3:2, meaning exports accounted for 60% of total sales, not including products manufactured in overseas bases.

On July 24, National Development and Reform Commission and Ministry of Finance co-released an announcement to step up the government support on the large-scale equipment renewal and trade-in of consumer goods with specific measures unveiled. It specifies that 300 billion yuan will be allocated in ultra-long special treasury bonds to boost large-scale equipment renewals and trade-ins of consumer goods, of which 150 billion yuan will be used for trade-ins of consumer goods that cover automobiles, home appliances, etc. This stimulus policy was proved to be effective in reviving the domestic refrigerator market in the last four months of 2024. According to data from AVC, from January to November 2024, the retail sales volume of refrigerators in China reached 37.96 million units, a 5.4% year-on-year increase, and the retail sales value reached 135.2 billion yuan, an 8.5% increase. The retail sales value of China's refrigerator market is expected to exceed 140 billion yuan under the boost of the trade-in policy, setting a new record in the history of China's refrigerator industry.

In 2024, with strong boost of the trade-in policy and a big growth in overseas markets, China's refrigerator industry achieved an impressive performance, with production and shipments reaching new historical highs. According to ChinaIoL.com, from January to November 2024, the total shipments of refrigerators in China was 88.35 million units, a 10.7% year-on-year increase, with shipments to the domestic market at 40.67 million units, a 2.3% increase, and exports at 47.68 million units, a 19.1% increase, accounting for 54% of total shipments.

From the data, the Chinese refrigerator industry has achieved a record-breaking production and shipments scale both at home and abroad in 2024. However, has the industry's development environment changed? The answer is no. The Chinese refrigerator industry, which is approaching a total sales volume of 100 million units, still faces three key challenges: “sluggish domestic market demand, severe technical competition pressure, and highly uncertain global markets.”

Response to Challenge 1: Building a New Marketing System for Trade-ins

As expected, the trade-in program will continue, likely throughout 2025, with a possible relaxation of requirements for participating dealers.

Therefore, addressing the pain points of the previous trade-in promotions is especially important. Feedback from several marketing experts of the refrigerator industry is clear: in the fourth quarter of 2024, companies have been adjusting their product structures to meet policy requirements, but in 2025, refrigerator companies must step up to resolve four major pain points in trade-in promotions: outdated promotional models, low investment returns, insufficient customer flow in the existing market, and the disconnect between after-sales services and marketing. This can be done by upgrading the trade-in service system and establishing a service system centered around “upgrading to a quality lifestyle.”

Many refrigerator companies are emphasizing a user-centered approach to trade-in product promotion. In the process, many brands have realized that the “new” in the trade-in context doesn’t just refer to new products—it also involves new scenarios and new consumer segments.

Thus, providing new products, services and scenarios and serving specific customer segments through new marketing platforms will be key strategies for Chinese refrigerator companies to implement in 2025.

Response to Challenge 2: Building an Advanced Technology Matrix to Prepare for the AI Era

In the domestic market, the best innovation speaks to the mind of users. Refrigerator brands must fully understand the consumption trends, new scenarios and consumer segments, using a comprehensive technology matrix to meet the practical needs of different scenarios and groups. Understanding the market is essential to ensure that technological innovations are targeted.

Research feedback indicates that AI is likely to become the next key player in technological competition.

On the one hand, the development of multimodal large language models has been fully adopted by home appliance companies, and all mainstream refrigerator brands are rapidly developing technologies to upgrade large models. On the other hand, the application of AI in refrigerators has very tangible potential in areas like voice control, energy optimization, and health management, where AI’s successful application could lead to leapfrog innovations.

In 2025, as the efficiency, adaptability, and security of large data models improve, AI will accelerate its application in areas such as ingredient management, health monitoring, and energy optimization, and will cover more products. Eventually, an algorithmic matrix will be formed to match different user groups and application scenarios.

The fierce pressure of technological competition is far from over. A strong innovation matrix and R&D system is the core driving force to meet both domestic trade-in demands and overseas profit growth.

Response to Challenge 3: Expanding Globally with Innovation as the Engine

After many years of technological innovation development and two years of high growth in the overseas market, overseas markets have been expected as the primary growth contributor of China’s refrigerator industry in 2025.

A survey of the refrigerator industry in 2024 shows that investments in overseas manufacturing bases by companies like Haier, Hisense, Midea, TCL, and Changhong have become the main contributors to the industry’s overall capacity increase. The production capacity of Chinese refrigerator brands overseas is expected to exceed 10 million units in the next two years thanks to the high-quality manufacturing as well as the effective localization of the Chinese refrigerator manufacturers over the years. However, the anti-globalization trends and geopolitical conflicts, along with deepening trade protectionism and financial wars, have created an increase of uncertainties in the overseas markets.

Mainstream refrigerator companies gave a consistent answer in the interviews. The development opportunities in the overseas market are believed to be in three areas where Chinese players happen to be strong at: energy-efficient and environmentally friendly technology upgrades, innovations in fresh keeping and healthcare technologies, and deepening integration of intelligent, IoT technologies. Plus, localization strategy is believed to be the key in the operation in the overseas markets, which requires companies to deeply understand local demands, quickly respond to market changes and therefore turn market risks into opportunities.