“Water heater market”
Rising demand and widespread household uses such as hot water for cooking, bathing, and cleaning are driving the growth of the water heater market
Water heater market The size is estimated at $ 28.5 billion in 2020, which is set to grow at a CAGR of 4.8% over the forecast period 2021-2026. Water heater is an electric heater that heats water for a wide variety of uses. Water heaters are available because of their energy efficiency and small size. Electric heating geysers are very common for home use. In addition, the water heater industry is growing due to increasing demand and widespread household uses such as hot water for cooking, bathing and cleaning. The water heater market would benefit from increasing demand for energy efficient systems and geysers, as well as favorable regulatory policies for carbon emissions. For example, in 2016 the United Arab Emirates invested $ 3 million in the region to implement green strategies. Additionally, the growing number of strategies being pursued by key players such as partnerships, acquisitions and collaborations to expand their presence and innovation in water heating technology to win the market will propel the water heater industry forward.
Water Heaters Market Segment Analysis – By Product Type:
Based on the product type, the electric heating segment had the largest sales market share in 2020 with around 75% and is also expected to grow with the fastest CAGR. Electric water heaters are becoming increasingly popular as people worry more about energy efficiency and the number of pre-installed unventilated systems in new buildings grows tremendously. In order to simplify the operation of electric heaters, manufacturers are integrating intelligent heating controls. Electric heaters are widely used in the commercial sector to support production and increase worker comfort. Water heaters are also being replaced more frequently due to different energy efficiency laws in different countries. As a result, the demand for highly efficient electric water heaters without a flow heater is growing, driving the water heater industry. The Solar Heater segment is expected to grow at the second fastest CAGR of 5.8% over the forecast period 2021-2026, due to increasing customer awareness of solar water heaters and their cost-effective and environmentally friendly benefits in both the residential and commercial sectors. In addition, government initiatives to promote solar heating products in India, as well as increasing technological advances and rapid urbanization, are expected to drive segment growth.
Water Heaters Market Segment Analysis – By Application:
Based on the application, Commercial had the largest revenue market share in 2020. The demand for water heaters is being driven by the expansion of commercial infrastructure in various countries. Water heaters are used by small to medium-sized companies in their daily operations. Companies are now using highly effective water heaters to reduce energy consumption and operating performance. Commercial water heaters need to be upgraded due to the increased usage. As a result, manufacturers are incorporating new innovations that can serve as indicators for commercial water heater upgrades. Instantaneous water heaters and electric heaters are becoming increasingly popular in the commercial sector as they can provide a large amount of hot water over an extended period of time and power the water heater industry. Residential properties are expected to record the fastest CAGR of 5.3% over the forecast period 2021-2026. Continuous growth of the infrastructure, combined with the increased use of energy-efficient heating systems, would advance the segment. According to the IBEF, India will need more than $ 777 billion in infrastructure investments by 2022. The industry will benefit from the ongoing adoption of smart cities with strict building efficiency policies and standards.
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Water Heaters Market Segment Analysis – By Geography:
Based on geography, the North American water heater market accounted for 38% of sales in 2020. More than 9 million water heaters are sold in the United States annually, suggesting that North America has strong demand for water heaters for much of the industry. Tankless water heaters in the United States are compact, reliable, and durable devices that offer high performance and much better energy efficiency than tank units. Due to the cold weather conditions in the region, the demand for heating appliances is extremely high in most of North American countries. In July 2017, Rinnai America announced that it had expanded its North American headquarters by building a new two-story headquarters and opening a North American innovation and training center to accelerate the expansion of water heaters across the region. The Asia-Pacific region is expected to be the fastest growing region in the forecast period 2021-2026 due to economic growth in countries like China, Japan, Australia and India
Water Heater Market – Drivers
The growing demand for storage heating:
By using hot water storage tanks, the hot water storage tanks help to maximize the heating output. Manufacturers offer storage heaters in various sizes to meet customer needs. Storage heaters are cheaper to install than other types of water heaters, and they are also easy to maintain and repair. However, since storage heaters are known to burst, providers focus on offering standard maintenance services. In addition, storage heaters require space for the tank; As a result, manufacturers are focusing on reducing the size of storage heaters to alleviate the space problem facing the water heater industry.
Water Heater Market Challenges
Increase in electricity prices:
Rising electricity prices are likely to slow the growth of the water heater industry. According to the US Department of Energy, water heating systems, such as electric heaters, are the second largest consumer of electricity in the home, accounting for 18 percent of total electricity costs. In addition, the study found that the average water heater runs for three hours every day, which hinders the development of the industry.
Water Heater Market – Landscape:
Major strategies in the water heating market include product launches, mergers and acquisitions, joint ventures, and regional expansion. The top 10 companies in the water heater market are State Industries, Ariston Thermo, Haier Electronics, Fast Water Heater, Neighborly Company Viessmann, Rinnai, AO Smith, Rheem Manufacturing, Whirlpool Corporation, and American Residential Services.
Acquisitions / product launches:
In August 2020, AO Smith launched MiniBot, a 3 liter instant water heater with modern technology. The inner tank of the MiniBot is filled with Blue Diamond glass, which offers superior corrosion resistance over traditional enameled items. It also protects against premature tank failure due to the hard and polluted water of India and extends the life of the water heater.
The central theses
The growth of the water heater market is being driven by technological advances, the introduction of new techniques, and the innovation that result in the manufacture of low cost and energy efficient heating systems.
Geographically, the North America Water Heater market had the largest share of sales of 38% in 2020 due to the presence of potential players developing new products, heavy investments in research and development, and government funding. The scope of the Water Heater market for different regions is given in the final report.
The water heater industry is expanding due to the increased awareness of product benefits in various applications and it is expected that consumer preferences will change as quality levels increase.
The growing demand for storage heating due to its ease of installation and maintenance is a major factor that is expected to drive the water heater industry in the forecast period 2021-2026.
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