Daikin Celebrates 100 Years of Innovation

Daikin, a global brand for heating, ventilating, air conditioning, and refrigeration, is poised to expand its presence in the region on rising demand of its energy-efficient quality products, says its senior executive.

Tuna Gulenc, Regional Vice-President, Daikin MEA, said the company has established its strong base in the UAE as the emirate is a gateway to the Middle East, Africa, Europe, and Western markets.

“As we continue to expand in the UAE and the broader region, we are increasing our operations, growing our workforce, and strengthening our sales and distribution networks. Additionally, we are introducing new services to meet evolving market demands,” Gulenc said during an interview.

Daikin, which was set up in 1924 by Akira Yamada as a business manufacturing parts for aircraft, established itself as a strong global brand for heating, ventilating, air conditioning, and refrigeration. It is celebrating 100 years of innovation this year and reaffirms its commitment to continue innovation and expand into new areas of consumer-oriented segments.

“At Daikin, introducing new products and technologies is part of our DNA, and that’s why we have existed for 100 years. Thanks to our core values of trust, partnerships, and innovation, combined with our focus on heating, ventilating, air conditioning, and refrigeration, we continue to innovate across our product portfolio and bring new technologies to the market to improve people's health and comfort,” Gulenc said.

With the increasing demand for air conditioning units due to a rise in building construction, managing energy consumption is critical and Daikin is addressing these challenges by continuously introducing more energy-efficient products to minimise energy requirements.

Another priority at Daikin is to reduce the environmental impact of refrigerants used in air conditioning systems. Daikin is actively developing and implementing eco-friendly refrigerants with lower Global Warming Potential (GWP), ensuring a more sustainable approach.

“Daikin is also leading the way by introducing new technologies to transform the market practice from a combustion-based heating system to more environment-friendly and efficient systems. We also continue to innovate and expand into new areas, such as refrigeration for food security.”

Daikin’s milestones

Between World War I and World War II, Japan faced a period of profound change and difficulty. It was during this time, in 1924, that Daikin was founded, integrating expertise in three core technologies — electronics, mechanics, and chemical technology. These areas form the foundation of the company's innovation and strength. This synergy is symbolised in the Daikin logo, represented by a triangle.

Established at a time when global cities were on the rise, Daikin invested significantly in air-conditioning, starting with a focus on the Japanese market. Soon after, Daikin began to eye global expansion and began exporting its products to the rest of the world.

After half a century, it established a base in Europe, starting first in Malta, and then Belgium with small manufacturing operations, which later led to the establishment of a very strong distribution network in Europe, including Italy, France, Portugal, and the UK. It later trained the technicians and created an air conditioning culture. After that, Daikin acquired distributors and expanded its network.

Between 1974 and 2005, Daikin subsequently became the number one brand in Europe for air conditioning. At the same time, Daikin expanded to China, starting first with a small factory, later expanding its operations to establish an air conditioning culture in China too.

The largest milestones in Daikin's more recent history are its acquisitions. In 2006, Daikin acquired a large Malaysia-based company called OYL, owners of McQuay and AAF, part of one of the world's largest chiller manufacturers. In 2012, Daikin acquired the largest air conditioning player in North America, Goodman, for almost $3.7 billion, which was an important milestone for expanding across North America. Today, Daikin's revenue in North America is more than $10 billion.

“Daikin also acquired local manufacturing company Airfel in Turkey, in 2011. Today, Daikin Turkey has close to $1 billion in operations, with a huge factory exporting to Europe. Daikin is established globally, with more than 180 factories worldwide.”

The Middle East foray

Gulenc said Daikin began its operations in the Middle East through independent distributors, but localisation has always been a key focus in our business development strategy.

“In 2006, we established our first office in Dubai, UAE, with a small team of employees. Since then, we have gradually expanded our operations in the country, and today, we have 750 employees in MEA.

“In 2013, we launched a joint venture in Saudi Arabia, followed by the start of operations in Egypt in 2016. In 2020, we established a presence in Qatar, and more recently, we opened offices in Africa, with locations in Nigeria and Morocco in 2021 and 2022, respectively. Additionally, we established two factories in the GCC: one in JAFZA, UAE, in 2014 and another in Saudi Arabia in 2022,” he said.

In reply to a question why Daikin established its base in the UAE, Gulenc said the country is a strategic location, has a conducive environment for investment with availability of talent and skills in the country.

“We chose Dubai as our regional hub due to its access to a highly skilled and diverse talent pool, along with a business-friendly environment supported by favourable government policies. Managing operations across 54 countries from Dubai allows us to benefit from the city’s multicultural workforce, which includes speakers of English, French, and Arabic. Additionally, Dubai's strategic location enables us to tap into talent from Southeast Asia, further strengthening Daikin's operations in the region,” he said.

While Daikin is already well established in the B2B sector, he said the UAE is becoming an increasingly important market due to its population growth and booming real estate sector. “This growth is driving higher demand for air conditioning units, as well as a growing need to refurbish older systems that are 10 to 15 years old.”

Expanding Presence

Gulenc said Daikin will continue to expand its footprint next year due to rising demand of its energy-efficient quality products worldwide.

“At Daikin, our expansion is an ongoing journey. For instance, in the UAE, we started with a small office, and later we expanded our sales network, recruited more people, and trained more technicians,” he said.

“Our factory went from small to large, expanding our product range. As we look to the future, we endeavour to expand the number of countries that we are established in, adopting a localisation approach to our expansion efforts, meaning we will work with and invest in the local community,” he said.

To a question, he said Daikin will expand its manufacturing facilities in the region.

“In 2025, we plan to further expand our manufacturing operations in the region. While we already have factories in the UAE and Saudi Arabia, we aim to broaden the scope of our production capabilities and increase our workforce. Additionally, we are exploring opportunities to expand into new regions, particularly North Africa,” he said.

About the rising demand of energy-efficient products, he said the Middle East is a core market for Daikin because of the region’s climate and environment.

“When it comes to the Middle East region, it is fair to say that one cannot imagine living in a space without air conditioning. With that said, every building has an air-conditioning unit, however, the focus now is on making these units more energy efficient. Driven by consumer demand and government regulations, manufacturers like us are working to deliver more energy-efficient solutions, and this is where we see demand growing,” he said.

— muzaffarrizvi@khaleejtimes.com