HVAC technicians must be highly specialized in their profession, and this means that repairs can be more expensive than usual. The demand for air conditioning parts, new units, and repairs tends to increase when the weather heats up, and the industry is used to receiving price increases from manufacturers every year. However, the COVID-19 pandemic has created a perfect storm that's making HVAC parts and equipment more costly than usual this summer. The pandemic has reduced the supply of raw materials and created labor shortages in the factories that manufacture the parts and equipment we need.
The cost of diesel, which is needed to bring our HVAC truck to your location to repair or replace your air conditioner, has also been high. We stock our trucks with as many parts, tools, and consumable HVAC supplies as we can to facilitate repairs, but larger vehicles are needed to transport HVAC units and supplies when they need to be replaced. This can mean that travel rates increase. The raw materials used to manufacture HVAC parts and equipment are in short supply and are also becoming more expensive.
The Bureau of Labor Statistics monitors the prices of products manufactured in the United States by month, so you can see the average prices as they change over time. The NASDAQ also documents commodity prices, and you can see the upward trend in prices over the past year. Another way to know that prices are high is when we recycle used HVAC equipment parts. Demand during the pandemic was low because factories weren't operating at full capacity, meaning prices were low.
That has changed in recent months. Fortunately, healthy air conditioning systems shouldn't need additional refrigerant. This is why a fully charged system shouldn't need to be “recharged”; if so, it means that it has a leak, which needs to be repaired. Semiconductor chips are found inside higher-efficiency HVAC systems, such as variable-speed HVAC units, multi-speed central air units, heat pumps, and mini-divisions.
Consumers love them because they are efficient, quiet and increase indoor comfort. However, Newsweek reports that the chip shortage is affecting the manufacture of new cars, smartphones, and computers. They also expect the chip shortage to extend to air conditioning systems. This means that we could see a lower supply of high-end, optimally efficient HVAC units and parts.
PC boards, the minicomputers that make them so efficient, can be harder to get and more expensive if you need a repair or replacement. The shortage of labor due to the pandemic has been added to delays and equipment shortages. That's why when you see the United States Bureau of Labor Statistics Producer Price Index (PPI) for HVAC equipment goes up (as shown in the chart below), HVAC service companies and consumers can also expect higher prices on air conditioners, heat pumps, and parts. The “Producer Price Index” measures the average change over time in sales prices received by domestic producers of goods and services.
Staying informed allows customers to better understand why supplies of air conditioners and heat pump parts may be limited and why prices are higher than usual this time of year. A variety of factors contribute to the increase in demand and decline in supply of HVAC equipment. The inflation rate is trending higher than it has been in some time according to government statistics. This means that the value of a dollar is lower which means that consumers may have to pay more for the same item.
Understanding all of these market forces at play can help you plan ahead and be patient if it takes longer than usual to supply an air conditioner repair part. Homeowners who know that their air conditioner may not last through the summer and fall could start thinking about replacing it now so that they have more time to decide what type of system they want and what features are essential. Most people keep a central air conditioner for 12 to 17 years so it's worth buying what you want because you might have it for a long time. Starting the HVAC replacement process before it becomes an emergency gives you additional time to make a decision and explore funding if you want.
Facing an expensive repair or replacement when temperatures reach 80°F or higher is not ideal; starting that process earlier puts you in the driver's seat and can reduce stress for everyone involved. An air conditioner malfunction when it's hot can be stressful. That's why we advocate regular maintenance and keeping abreast of market conditions. This gives savvy customers options to stay comfortable when the weather is hot.
We want customers to understand why supplies of air conditioners and heat pump parts may be limited and why prices are higher than usual this time of year. Starting early on your research process gives you additional time to make a decision on what type of system you want and what features are essential. It's worth buying what you want because you might have it for a long time.