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The Water Heater Market size is forecast to increase by USD 6.98 billion at a CAGR of 5.5% between 2022 and 2027. The growth of the market is driven by several key factors. Firstly, there's a notable surge in the demand for tankless water heaters, fueled by their energy efficiency and space-saving benefits. Secondly, the commercial end-user segment is witnessing an uptick in demand, driven by the need for reliable and efficient water heating solutions in various industries. Additionally, government initiatives aimed at promoting energy-efficient heating solutions further bolster market growth, incentivizing both consumers and businesses to adopt environmentally friendly technologies. These factors collectively underscore the importance of energy efficiency and sustainability in the evolving landscape of water heating solutions.
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This report extensively covers market segmentation by end-user (residential, commercial, and industrial), distribution channel (specialty stores, department stores hypermarkets and supermarkets, online retailers, and others), type (electric, gas, and solar), and geography (APAC, North America, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
The market encompasses a range of innovative products and high-performance products, including electric product and solar water heating systems, tankless and storage water heater, and smart technology applications. These solutions are increasingly being adopted in residential establishments and smart city projects to reduce environmental impact and improve energy efficiency. Electric water and tankless water heaters are popular choices for their high energy savings and carbon footprint reduction. Solar products, such as solar water heating systems, further enhance the environmental benefits of these systems. In the context of residential applications, water heating systems play a crucial role in daily life, from cleaning and washing to cooking and patient hygiene. Hospitals also rely on water heating systems for essential services.
Further, green projects and smart city initiatives are driving the demand for water heating solutions that minimize carbon emissions and offer high-performance and innovative features. Aging water heaters, on the other hand, are being replaced with more energy-efficient and eco-friendly alternatives. Storage tanks and cleaning systems are essential components of water heating systems, ensuring consistent water temperature and maintaining system hygiene. Overall, the market is poised for growth as the world transitions towards more sustainable and energy-efficient solutions. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The increasing demand for tankless water heaters is a key factor driving the growth of the market. In the market, there is a growing trend towards energy-efficient models, particularly in residential establishments and smart city projects. With aging water heaters leading to increased maintenance and utility costs, the shift toward electric water heaters is gaining momentum. These advanced heating solutions offer high energy savings, making them an attractive option for both residential and commercial consumers. The Department of Defense and military facilities, hotels, shopping complexes, and commercial buildings are all exploring environmentally friendly products to reduce their carbon footprint.
However, tankless water heaters, which use heavy burners to quickly heat water through a heat exchanger, have been found to be 22% more energy-efficient than gas-powered storage water heaters. As consumer spending on heating technologies continues to rise, companies are differentiating their products by launching energy-efficient electric water heaters, providing instant hot water with lower utility costs and reduced environmental impact. Thus, the demand for energy-efficient models is expected to boost the growth of the market during the forecast period.
Smart and connected kitchens are the primary trends in the market growth. The market is witnessing a significant trend towards the adoption of smart water heating solutions. In residential establishments and smart city projects, advanced water heaters equipped with monitoring systems are gaining popularity. These systems enable end-users to maintain their water heaters effectively, removing allergens, harmful particles, and contaminants that can cause wear and tear. The integration of smart technologies, such as smart thermostats and sensors, into electric water heaters and storage water heaters results in high energy savings and a reduced carbon footprint.
Further, institutions like the Department of Defense and military facilities, as well as commercial buildings, hotels, shopping complexes, and other large establishments, are increasingly investing in environmentally friendly and energy-efficient heating solutions, such as tankless water heaters and gas water heaters. Consumer spending on heating technologies continues to grow, driven by the desire for cost savings and sustainable heating solutions, which inturn drive the market growth during the forecast period.
The high installation and maintenance costs are a major challenge to the growth of the global market . In the market for water heating solutions, tankless water heaters have emerged as a preferred choice due to their efficiency in both residential and commercial applications. These advanced heating technologies offer significant savings by providing hot water on demand, reducing the need for large storage tanks found in traditional water heaters. However, the initial investment and ongoing maintenance costs can be a challenge for some consumers. Moreover, the aging of water heaters in various establishments, including residential and military facilities, shopping complexes, and hotels, necessitates timely replacement and maintenance. The increasing demand for energy-efficient and environmentally friendly products in smart city projects further emphasizes the importance of maintaining and upgrading water heating systems.
Moreover, electric and gas water heaters, including both storage and tankless models, are essential components of heating solutions for various industries. The Department of Defense and commercial buildings, such as hotels and shopping complexes, rely on these systems to ensure consistent hot water supply. Consumer spending on heating technologies continues to grow, making it crucial to address the challenges of tankless water heater installation, maintenance, and skilled labor shortages in the HVAC industry. All these factors increase the operational cost of water heaters during their overall life cycle, thus hindering the growth of the global market in focus during the forecast period.
The report includes the adoption lifecycle of the market research and growth, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market research report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Ariston Holding NV- The company caters to various water heater options, including the Aures Slim Multi, an electric instantaneous model.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market share growth by the residential segment will be significant during the forecast period. In the market of 2022, residential establishments and commercial buildings, including military facilities, hotels, and shopping complexes, predominantly rely on specialty stores and vendor-specific showrooms for their water heating needs. These establishments prioritize savings and seek high energy efficiency, leading to the popularity of smart city projects and environmentally friendly products such as electric water heaters, storage water heaters, tankless water heaters, and gas water heaters.
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The residential segment was valued at USD 13.77 billion in 2017 and continue to grow by 2021. Consumers value the expertise and advice provided by these retailers, allowing them to evaluate various heating solutions and make informed decisions. As aging water heaters contribute to a significant carbon footprint, the market trend leans towards the adoption of heating technologies that offer high energy savings and reduced environmental impact. The Department of Defense and other large consumers prioritize these factors in their purchasing decisions.
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APAC is estimated to contribute 48% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional market trends and drivers that shape the market during the forecast period. The market in APAC, particularly in residential applications, is driven by increasing infrastructure spending and a positive economic scenario. Vendors prioritize product innovation, focusing on energy efficiency and smart technology, such as AI and Wi-Fi, to cater to this demand. In September 2022, Venus Home Appliances launched new electric and solar water heating systems with these features. The growth of the market is also influenced by the increasing adoption of green projects and the shift towards energy-efficient solutions.
In residential settings, water heating systems include storage tank and tankless products, while industrial applications utilize high-performance and reliable hybrid systems. Smart technology and the Internet of Things enable increased safety, efficiency, and less required space in both residential and commercial settings. The market also includes cleaning, washing, cooking, and patient hygiene applications in hospitals and smaller commercial buildings like diners and eating joints. Government initiatives, such as the Introduction Subsidy Scheme, further promote the adoption of energy-efficient and innovative water heating solutions.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
The Residential and Applicative Markets for Water Heaters are experiencing significant growth. Envision a world where hot water is always available on demand. With the increasing use of technology, Smart Water Heaters are becoming more popular. Producers of Water Heaters, such as Cogent, are focusing on producing efficient and cost-effective solutions. The market for Water Heaters is driven by factors like increasing population, urbanization, and changing consumer preferences. The Energy Regulators are also encouraging the use of Energy-efficient Water Heaters, which is a major trend in the market. The market is projected to grow, with Tanks and Tankless Heaters being the major product categories. The Producers are also focusing on increasing their production capacity to meet the growing demand. The market is a global one, with China and India being major markets due to their large populations. The market is expected to continue its growth trajectory in the coming years.
Market Scope |
|
Report Coverage |
Details |
Page number |
191 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 5.5% |
Market growth 2023-2027 |
USD 6.98 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
5.3 |
Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
Performing market contribution |
APAC at 48% |
Key countries |
US, China, Japan, India, and Germany |
Competitive landscape |
Leading companies, Market Positioning of companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
A. O. Smith Corp., AB Electrolux, Ariston Holding NV, Bradford White Corp., Ferroli Spa, Guangdong Vanward New Electric Co. Ltd., Haier Smart Home Co. Ltd., Havells India Ltd., Jaquar India, Hangzhou Kangquan Water Heater Co. Ltd., Lennox International Inc., Midea India Pvt. Ltd., Noritz Corp., Rheem Manufacturing Co., Rinnai Corp., Robert Bosch GmbH, STIEBEL ELTRON GmbH and Co. KG, Transform Holdco LLC, Vaillant Group, Viessmann Climate Solutions SE, and Whirlpool Corp. |
Market dynamics |
Parent market growth analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Market Segmentation by Distribution Channel
8 Market Segmentation by Type
9 Customer Landscape
10 Geographic Landscape
11 Drivers, Challenges, and Trends
12 Vendor Landscape
13 Vendor Analysis
14 Appendix
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