Dublin, May 09, 2024 (GLOBE NEWSWIRE) -- The "U.S. Water Heater Market - Industry Outlook & Forecast 2024-2029" report has been added to ResearchAndMarkets.com's offering.
The U.S. Water Heater Market was valued at USD 3.45 billion in 2023, and is projected to reach USD 5.08 billion by 2029, showcasing a CAGR of 6.66%.
The competition among vendors in the U.S. water heater market is quite intense. This market is highly fragmented, with many companies competing for market share. The rapidly changing technological environment could adversely affect vendors as customers expect continual innovations and upgrades. The industry is moderately fragmented, with many players providing advanced features and designs for water heaters. The three major vendors in the U.S. water heater market are A. O. Smith, Bradford White Corporation, and Rheem Manufacturing.
Midwest is the most significant contributor in the U.S. water heater market, generating over USD 1 billion in revenue in 2023. The Midwest U.S. is a large region encompassing many states, each with its own market dynamics and consumer preferences. Further, the more individuals and families settle in urban areas, the more reliable and efficient water heating solutions become dominant for daily living. In addition, the Midwest's diverse climate, depicted by cold winters, necessitates using water heaters to provide warm water for domestic use, including bathing, cleaning, and cooking.
MARKET TRENDS & OPPORTUNITIES
Rising Popularity of Tankless Water Heaters
The popularity of tankless water heaters is rapidly increasing in the U.S. water heater market due to their several advantages. Their on-demand heating system makes them significantly more energy-efficient than traditional water heaters, lowering utility bills. This efficiency can also lead to eligibility for tax breaks and energy incentives in certain locations, encouraging homeowners to switch. In addition, the longer lifespan of tankless water heaters, often exceeding 20 years, appeals to those seeking durable and cost-effective solutions.
The Popularity of Electrification Heaters in Commercial
The growing popularity of electric water heaters in commercialization in the U.S. water heater market has been driven by their environmentally friendly attributes. Unlike gas water heaters, electric ones do not produce toxic fumes, leading to reduced air pollution. In addition, their easy installation process makes them convenient for various commercial settings. Moreover, using electric heaters contributes to decarbonization efforts, aligning with the growing focus on environmentally friendly and sustainable practices.
INDUSTRY RESTRAINTS
High Installation Cost of Water Heater
The installation cost of a water heater includes various factors, making it essential to consider both labor and materials. The average installation costs range from USD 900 to USD 3,000, typically around USD 1,400. Furthermore, the hourly rates for local plumbers typically range from USD 50 to USD 200, with additional charges, such as electrician work, costing between USD 50 and USD 150 per hour.
Apart from labor, the expenses include parts and materials necessary for a successful and efficient water heater installation. These materials include pipes, fittings, pipe thread compound, pressure release valves, solder, venting pipes, connectors, and water & gas piping. The complexity of the installation increases the demand for additional materials, impacting the overall replacement cost.
INSIGHTS BY PRODUCT
The U.S. water heater market by product is segmented as gas and oil, electric, heat pumps, and solar. The gas & oil segment accounted for the highest industry share in the product type segment. Gas & oil are highly 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 LPG, requiring a gas line hookup. Gas water heaters come in various sizes, ranging from as small as 20 gallons to as large as 100 gallons. Also, they boast an energy efficiency of more than 80-85%. By the end of the forecast period, gas & oil are expected to continue their dominance in usage and acceptance among end-users and account for the largest market share in 2029.
INSIGHTS BY CATEGORY
The U.S. water heater market by category is segmented as storage and instant. In 2023, the storage segment held the most significant U.S. water heater market share. The surge in demand is attributed to the popularity of the storage water heater, which is driven by affordability, versatility, easy installation, high flow rate, and the ability to store hot water efficiently for long durations.
These features collectively contribute to the segment's significance, reflecting the market's preference for reliable, cost-effective heating products. Furthermore, the instant segment market growth can be attributed to factors like the increasing emphasis on energy efficiency, the low maintenance requirements, and the assurance of a continuous hot water supply. Moreover, consumers have a rising awareness and prioritization of sustainability, further driving the demand for instant water heaters.
INSIGHTS BY DISTRIBUTION CHANNEL
The offline distribution channel accounted for the highest U.S. water heater market share in 2023. This segment's demand for water heaters increases because consumers touch the product and check the quality before purchasing. Also, companies offer a comprehensive range of products in offline channels, such as various varieties of electric, heat pumps, gas, and others. Retailers act as the face of the companies and are the point of purchase for most customers.
However, the online segment witnessed the highest CAGR in the distribution channel segment during the forecast period. The demand for water heaters through online channels has increased due to the rising internet penetration worldwide. Moreover, the number of smartphone users has rapidly grown, contributing to the success of online water heater sales.
INSIGHTS BY END-USER
The U.S. water heater market by end-user is segmented as residential and commercial. In 2023, the residential segment accounted for the highest share in the end-user segment. The surge in demand can be attributed to a growing population, rising building permits, and continuous innovation in water heating technologies. Collectively, these drivers contribute to the sustained growth and prominence of the residential water heater industry. However, the commercial segment is projected to witness faster growth in the U.S. water heater market during the forecast period.
With the rapid shift towards urbanization, significantly rising infrastructure, and increasing number of corporate offices, hotels, and restaurants, demand for water heaters is growing considerably from the commercial sector. Also, the healthcare sector substantially increases the demand for water heaters due to its stringent hygiene, sanitation, and infection control requirements.
KEY QUESTIONS ANSWERED
- How big is the U.S. water heater market?
- What is the growth rate of the U.S. water heater market?
- Which region dominates the U.S. water heater market?
- What are the significant trends in the U.S. water heater market?
- Who are the key players in the U.S. water heater market?
Key Attributes:
| Report Attribute | Details |
| No. 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 |
| Compound Annual Growth Rate | 6.6% |
| Regions Covered | United States |
Market Opportunities & Trends
- Rising Popularity of Tankless Water Heaters
- Growing Demand for Smart Water Heater
- Increased Renewable Energy Use in Water Heaters
Market Growth Enablers
- The Popularity of Electric Water Heaters in Commercial Settings
- Technological Advances in Products
- Increasing Construction Activities
Market Restraints
- Challenges in Energy Efficiency for Water Heaters
- Variation of Gas and Other Fuel Prices
- High Installation Cost of Water Heaters
Key Company Profiles
- A.O. Smith
- Bradford White Corporation
- Rheem Manufacturing Company
Other Prominent Vendors
- Alternate Energy Technologies
- Apricus Solar
- Bock Water Heaters
- BSH Home Appliances
- Bosch Home Comfort
- Eccotemp
- General Electric
- Heliodyne
- HTP
- Hubbell Water Heaters
- 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
- Whirlpool
For more information about this report visit https://www.researchandmarkets.com/r/s3qtc7
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