The third quarter of 2025 brought a mixed landscape for M&A across the HVAC industry. As always, the sector’s performance is nuanced, reflecting the varied dynamics of the three primary segments we track – manufacturing, wholesale distribution, and HVAC/R services.
In manufacturing, continued tariff uncertainty remains the dominant headwind. Both buyers and sellers have been hesitant to move forward while waiting for clarity on U.S. trade policy. Although recent negotiations have renewed optimism that any long-term impact may be limited with major trading partners, many owners appear inclined to pause sale plans until new policies are finalized and there is clearer evidence that cost increases can be successfully passed through to customers.
From our own client base and business owners contemplating a sale in the near term, the focus has been on maintaining operational stability – essentially, looking inward before launching an M&A process. This has led some to delay transaction plans, but we note pent-up demand building throughout the year, with the expectation that greater certainty heading into 2026 will unlock additional M&A supply and deal activity.
If you have any questions or would like to discuss how these trends may impact your business, please don’t hesitate to reach out.