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Variable Frequency Drive Market Size To Hit $39.7 Billion By 2030, Owing To High Demand From Power Generation, Automotive, Oil And Gas Sectors | Grand View Research, Inc.

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Variable Frequency Drive Market Size To Hit $39.7 Billion By 2030, Owing To High Demand From Power Generation, Automotive, Oil And Gas Sectors | Grand View Research, Inc.

May 25
05:13 2022
Variable Frequency Drive Market Size To Hit $39.7 Billion By 2030, Owing To High Demand From Power Generation, Automotive, Oil And Gas Sectors | Grand View Research, Inc.
Grand View Research, Inc. – Market Research And Consulting.
According to a new report published by Grand View Research, increasing investment in infrastructure development is resulting in high demand for HVAC systems, this is expected to positively impact the variable frequency drive (VFD) industry growth.

Variable Frequency Drive Industry Overview

The global variable frequency drive market size was valued at USD 24.9 billion in 2021 and is anticipated to reach USD 39.7 billion by 2030, registering a CAGR of 5.5% During the forecast year.

Increasing penetration of connected devices in various sectors such as commercial, industrial, and residential sectors, coupled with rising demand for variable frequency drive (VFD) due to their benefits such as adjustable speed, dynamic torque control, and energy-saving from sectors such as power generation, automotive, and oil & gas are crucial factors expected to drive the market growth. Additionally, increasing investment in infrastructure development is resulting in high demand for HVAC systems which calls for solutions to improve building energy efficiency this factor is expected to positively impact the target market growth.

Gather more insights about the market drivers, restrains and growth of the Global Variable Frequency Drive Market

Rapid industrialization in developing countries is resulting in high growth in the industrial and manufacturing sectors, which supports the demand for variable frequency drive. Likewise, the power generation sector is widely adopting variable frequency drive as they use it to smoothly start large motors and continuously adjust the speed as required by the process. Thus, increasing demand for variable frequency drive from the power generation sector is expected to augment the target market growth. Industries such as metal & mining, food processing, and oil & gas use various equipment for operations that vary in technology. VFDs are used by induction, forced draft fans, boiler feed pumps, service water pumps, and conveyors that provide high power, precise speed control, and significant energy savings.

 

North America Variable Frequency Drive Market size, by product type, 2020-2030 (USD Billion)

 

Governments across the globe are implementing stringent regulations to lower the CO2 impact on the environment and save energy which is resulting in the adoption of energy-efficient products. Also, they are planning to meet energy efficiency and CO2 emission goals to reduce greenhouse gas emissions. This is resulting in the implementation of new rules, thereby supporting market growth. For instance, in October 2019, Ecodesign Regulation (EU) 2019/1781 came into effect which was implemented in two stages the first stage in July 2021 and the second in July 2023. In the first stage, the regulation covered the IE2 efficiency class mandatory for AC drives.

The major challenges faced by the global variable frequency drive market are the high initial cost of the variable speed drives and economic slowdown. Due to the economic slowdown, the industrial and commercial sectors witnessed slow growth which lowered the demand for variable frequency drive. Also, due to covid-19, there was a disruption in the supply chain of raw materials which impacted the availability of products. Additionally, lack of skilled labor and high cost associated with maintenance are factors expected to hamper the global market growth

The outbreak of COVID-19 globally significantly impacted the global market growth. Implementation of strict lockdown and shut down of manufacturing facilities resulted in a decline in demand for variable frequency drives. However, in the second quarter of 2021, the manufacturing sector witnessed growth gradually increasing the demand for VFD and by the second quarter of 2022, the market is expected to witness growth at its full potential.

 

Variable Frequency Drive Market Segmentation

Based on the Product Type Insights, the market is segmented into AC drives, DC drives and servo drives

  • The AC drives segment accounted for a revenue share exceeding 68% in 2021. This growth can be attributable to the benefits of AC drives such as providing high power, easy installation compared to others, and minimal maintenance. These benefits are attracting various end-users from industries such as food & beverage, automotive, and power generation to enhance operational efficiency.
  • The DC drive segment is anticipated to witness moderate growth in the target market and is expected to register a CAGR of 4.8% from 2022 to 2030. The use of DC technology in industries is limited as they have high maintenance cost compared to AC technology. Also, DC technology is not considered energy-efficient, and cannot operate in critical conditions these factors are anticipated to hamper the segment growth.

 

Based on Application Insights, the market is segmented into pumps, electric fans, conveyors, HVAC, extruders and others

  • Pumps segment accounted for a revenue share of 29% in 2021. Pumps are widely used in the water treatment industry, metal industry, and oil & gas industry. These pumps are integrated with variable frequency drives which help them reduce power consumption, decreasing the cost to operate a pump and help operate at variable speeds without a gearbox.
  • HVAC segment is anticipated to account for a significant revenue share and register a CAGR of 6.8% from 2022 to 2030. The rapid increase in residential and commercial construction activities is anticipated to augment demand for HVAC systems. Attaching VFD to the HVAC system helps in increasing energy efficiency by controlling the speed of blower fans, pumps, or compressors.

 

Based on the Power Range Insights, the market is segmented into micro (0-5 kw), low (6-40 kw), medium (41-200 kw) and high (>200 kw)

  • Low power range segment dominated the global market in terms of revenue share accounting for more than 40% in 2021. End-use industries use low voltage frequency drives for operating equipment such as pumps, fans, belt conveyors, centrifugal pumps, and centrifugal compressors. Manufacturers are investing heavily in the development of high-performance, compact size, and low-temperature low voltage drives.
  • The medium power range frequency drive accounted for a significant revenue share and is expected to register a CAGR of 5.7% from 2022 to 2030. Medium (41-200 kW) power range frequency drive provides the advantages such as greater operational flexibility and better control which is a major reason its demand from various industries such as wastewater plants, petrochemical, mining, etc. is increasing.

 

Based on End-use Insights, the market is segmented into oil & gas, power generation, industrial, infrastructure, automotive, food & beverages and others

  • The oil & gas segment dominated the global market by accounting for a revenue share of 20% in 2021. The oil & gas sector uses heavy pumps and motors at the production site for various applications such as extraction, pumping, distribution, etc. Integrating the variable frequency drive with the motors helps in increasing the output by lowering the energy consumption.
  • Players’ approach toward maximizing profit by enhancing efficiency is expected to fuel the demand for VFD. The industrial segment is expected to account for a significant revenue share in the target market.
  • The infrastructure segment is anticipated to grow at a CAGR of 6.6% from 2022 to 2030. This growth can be attributed to increasing construction activities across the globe. Likewise, the inclination toward replacing the present mechanical drives with electric motors in the construction sector will surge the demand for VFD.

 

Based on the Regional Insights, the market is segmented into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa

  • Asia Pacific market was valued at USD 8.5 billion in 2021 and dominated the market in the coming years. Rapid industrialization in emerging economies, supportive business policies by the government and increasing construction activities are factors expected to support the regional market growth. Likewise, the rising energy demand is expected to increase the adoption of VFD from energy producers which is expected to support the regional growth.
  • Strong and stable economic growth due to rapid commercialization and the presence of major automotive, water treatment, pulp, and food & beverage manufacturers operating in the countries such as India, China, and Japan is expected to surge demand for VFD to improve working efficiency and reduce energy consumption.
  • Latin America is expected to expand at a CAGR of 6.2% over the forecast period, owing to counties such as Brazil and Mexico witnessing privatization and urbanization. Likewise, increasing demand from various end-use industries such as cement, chemical, and pulp is expected to support the VFD market growth in this region.

 

Market Share Insights:

  • May 2021: Emerson Electric Co., a global electric component manufacturer announced the launch of Copeland Variable Frequency Drives.
  • October 2019: Ecodesign Regulation (EU) 2019/1781 came into effect which was implemented in two stages the first stage in July 2021 and the second in July 2023. In the first stage, the regulation covered the IE2 efficiency class mandatory for AC drives.

 

Key Companies Profile:

Key players that dominated the market in 2021 include ABB, Eaton, General Electric, and Hitachi Ltd. Major player are focused on enhancing the business and increasing the customer base by the introduction of new products.

Some prominent players in the global variable frequency drive market include:

  • ABB
  • Eaton
  • General Electric
  • Hitachi Ltd.
  • Rockwell Automation Inc.
  • Schneider Electric
  • Siemens AG
  • The Danfoss Group
  • WEG S.A.
  • Yaskawa Electric Corporation

 

Order a free sample PDF of the Variable Frequency Drive Market Intelligence Study, published by Grand View Research.

 

About Grand View Research

Grand View Research is a full-time market research and consulting company registered in San Francisco, California. The company fully offers market reports, both customized and syndicates, based on intense data analysis. It also offers consulting services to business communities and academic institutions and helps them understand the global and business scenario to a significant extent. The company operates across multitude of domains such as Chemicals, Materials, Food and Beverages, Consumer Goods, Healthcare, and Information Technology to offer consulting services.

Web: https://www.grandviewresearch.com

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