United States Water Heater Market Outlook & Forecasts

Dublin, May 9, 2024 (GLOBE NEWSWIRE) — The “US Water Heater Market – Industry Outlook and Forecast 2024-2029” report has been added ResearchAndMarkets.com Offer.

The US water heater market was valued at $3.45 billion in 2023 and is expected to reach $5.08 billion by 2029, growing at a compound annual growth rate of 6.66%.

Competition among vendors in the US water heater market is quite intense. This market is highly fragmented and many companies compete for market share. The rapidly changing technological environment could negatively impact providers as customers expect continuous innovation and upgrades. The industry is moderately fragmented and many players offer advanced water heater features and designs. The three largest players in the US water heater market are AO Smith, Bradford White Corporation and Rheem Manufacturing.

The Midwest is the largest contributor to the U.S. water heater market, generating over $1 billion in sales in 2023. The Midwestern United States is a large region with many states, each with its own market dynamics and consumer preferences. As more individuals and families settle in urban areas, more reliable and efficient water heating solutions become prevalent in daily life. Additionally, the diverse climate of the Midwest, characterized by cold winters, requires the use of water heaters to provide warm water for household use, including bathing, cleaning, and cooking.

Market trends and opportunities

Increasing popularity of tankless water heaters

Tankless water heaters are becoming increasingly popular in the US water heater market due to their numerous benefits. Their demand-controlled heating system makes them significantly more energy efficient than traditional water heaters and reduces electricity bills. These efficiencies can also lead to tax breaks and energy incentives being available in certain locations, encouraging homeowners to make the switch. Additionally, the longer lifespan of tankless water heaters, often exceeding 20 years, is attractive to those seeking long-lasting and cost-effective solutions.

The popularity of electric heaters in the commercial sector

The growing popularity of electric water heaters in marketing in the US water heater market is due to their environmentally friendly features. Unlike gas water heaters, electric water heaters do not produce toxic fumes, resulting in lower air pollution. In addition, their easy installation process makes them suitable for various commercial environments. Additionally, the use of electric heating contributes to decarbonization efforts and is in line with the growing focus on environmentally friendly and sustainable practices.


High water heater installation costs

The cost of installing a water heater involves several factors, which is why it is important to consider both labor and materials. The average installation cost is between $900 and $3,000, typically around $1,400. Additionally, hourly rates for local plumbers typically range from $50 to $200, with additional fees such as: Some jobs, such as electrical work, can cost between $50 and $150 per hour.

In addition to labor costs, costs also include parts and materials necessary for a successful and efficient water heater installation. These materials include pipes, fittings, pipe thread connections, pressure relief valves, solder, vent pipes, connectors, and water and gas lines. The complexity of the installation increases the need for additional materials, which affects the overall replacement cost.


The US water heater market is segmented by product into gas and oil, electric, heat pumps and solar. The gas and oil segment had the highest industry share in the product type segment. Gas and oil are very popular among end users and have a wide customer base due to the low cost of natural gas. Gas and oil water heaters use gases such as natural gas and liquefied petroleum gas and require a gas line connection. Gas water heaters come in a variety of sizes, from 20 gallons to 100 gallons. They also have an energy efficiency of over 80-85%. Gas and oil are expected to maintain their dominance in usage and acceptance among end-users through the end of the forecast period and account for the largest market share in 2029.


The US water heater market is divided by category into storage and instantaneous water heaters. In 2023, the storage segment held the largest US water heater market share. The increase in demand is due to the popularity of hot water storage tanks due to affordability, versatility, ease of installation, high flow rate and the ability to efficiently store hot water for long periods of time.

These features collectively contribute to the importance of the segment and reflect the market's preference for reliable, cost-effective heating products. Furthermore, the segment's immediate market growth is attributed to factors such as increasing emphasis on energy efficiency, low maintenance and ensuring continuous hot water supply. Additionally, there is a growing awareness and prioritization of sustainability among consumers, which further drives the demand for tankless water heaters.


The offline sales channel had the highest US water heater market share in 2023. The demand for water heaters in this segment is increasing because consumers touch the product and check the quality before purchasing. In addition, companies offer a full range of products in offline channels, such as various types of electric, heat pump, gas and other products. The retail sector acts as a flagship for companies and is the point of contact for most customers when shopping.

However, the online segment recorded the highest CAGR in the distribution channel segment during the forecast period. The demand for water heaters through online channels has increased worldwide due to increasing internet penetration. In addition, the number of smartphone users has increased rapidly, which contributes to the success of online water heater sales.


The US water heater market is segmented into residential and commercial based on end user. In 2023, the residential segment had the highest share in the end-use segment. The increase in demand is due to a growing population, increasing building permits and continued innovation in water heating technologies. Taken together, these drivers contribute to the sustainable growth and importance of the residential water heating industry. However, the commercial segment is projected to witness faster growth in the US water heater market during the forecast period.

With the rapid shift towards urbanization, significantly growing infrastructure and increasing number of corporate offices, hotels and restaurants, the demand for water heaters in the commercial sector is growing significantly. Additionally, the healthcare sector significantly increases the demand for water heaters due to its stringent sanitation, hygiene and infection control requirements.


  • How big is the US water heater market?
  • What is the growth rate of the US water heater market?
  • Which region dominates the US water heater market?
  • What are the key trends in the US water heater market?
  • Who are the key players in the US water heater market?

Key Features:

Report attribute details
number of pages 201
Forecast period 2023 – 2029
Estimated market value (USD) in 2023 $3.45 billion
Forecasted market value (USD) by 2029 $5.08 billion
Annual growth rate 6.6%
Regions covered United States

Market opportunities and trends

  • Increasing popularity of tankless water heaters
  • Growing demand for smart water heaters
  • Increased use of renewable energy in water heaters

Market growth promoter

  • The popularity of electric water heaters in the commercial sector
  • Technological advances in products
  • Increasing construction activity

Market Restrictions

  • Water Heater Energy Efficiency Challenges
  • Fluctuations in gas and other fuel prices
  • High water heater installation costs

Important company profiles

  • AO Smith
  • Bradford White Corporation
  • Rheem Manufacturing Company

Other prominent providers

  • Alternative energy technologies
  • Sunny Solar
  • Bock water heater
  • BSH household appliances
  • Bosch Home Comfort
  • Ecotemp
  • General Electric
  • Heliodyne
  • HTP
  • Hubbell water heater
  • Intellihot
  • Kingspan
  • Kenmore
  • Lennox International
  • Midea
  • Navien
  • Noritz America Corporation
  • RECO
  • Rinnai America Corporation
  • Sioux Corporation
  • SunMaxx Solar
  • SunEarth
  • State water heaters
  • Stiebel Eltron
  • Viessmann
  • Watts Water Technologies
  • Westinghouse Electric Company
  • Jacuzzi

For more information about this report, please visit https://www.researchandmarkets.com/r/s3qtc7

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