USD 3.85 Billion
Tankless Water Heater Market Size, Share, Growth Analysis, By Product (Electric, Gas), By Application (Residential, Commercial), By Flow Rate (Low Flow Rate, High Flow Rate), By Region -Industry Forecast 2025-2032
Report ID:
SQMIG25E2127 |
Region:
Global |
Published Date: January, 2025
Pages:
186
|Tables:
84
|Figures:
71
Tankless Water Heater Market Insights
Global Tankless Water Heater Market size was valued at USD 3.85 Billion in 2023 and is poised to grow from USD 4.18 Billion in 2024 to USD 8.15 Billion by 2032, growing at a CAGR of 8.7% in the forecast period (2025-2032).
Tankless water heaters demand is increasing because the number of customers is rising to sustain energy. These water heaters compared to conventional appliances are known for less energy usage. Tankless water heaters, according to Energy.gov, can offer 24.0%, 34.0% more energy efficiency as against the conventional storage water heaters. Rising popularity among environmentally concerned customers is attributed to its higher energy efficiency. Due to their ability to save energy and space, more people are becoming interested in acquiring them at both domestic and commercial levels. The tankless heaters are suitable for homes with smaller areas because they do not require a large tank to hold water. The heater saves energy by allowing only the necessary amount of water at a time to have hot water; this eliminates the consumption of hot water continuously just because there is a tankful. Another big reason that tankless water heaters are attractive to environment conscious buyers is that most energy star rated. Tankless water heaters, while more expensive at point of sale, save money over the years compared to a traditional 40-gallon water heater, largely due to their energy efficiency and lower utility cost. Besides saving money, they are more predicted to have a warranty and lifespan that matches these savings. A tankless water heater can save $100 to $200 per year on electricity. The tankless water heater market growth is expected to boost significantly over the forecast period as more and more consumers switch from conventional versions of water heaters to tankless versions.
Market snapshot - (2025-2032)
Global Market Size
Largest Segment
Residential
Fastest Growth
Commercial
Growth Rate
8.7% CAGR
Global Tankless Water Heater Market ($ Bn)
Country Share for Europe (%)
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Tankless Water Heater Market Segmental Analysis
The global tankless water heater market is segmented into product, application, flow rate, and region. By product, the market is classified into electric and gas. Depending on the application, it is divided into residential and commercial. According to flow rate, the market is bifurcated into low flow rate and high flow rate. Regionally, the market is studied across North America, Europe, Asia-Pacific, Middle East and Africa, and Latin America.
Analysis by Product
As per the 2024 tankless water heater market analysis, the electric tankless heaters category dominated the market and is expected to grow at the fastest CAGR of 8.9% during the forecast period. These heaters are inexpensive to install and are easy to set up. In addition, electric items often have low operating costs and long-life spans. Further, whereas the gas equivalents, these innovative heaters will not only enable installation in narrower spaces but will not require any ventilation. However, while the gas products have to be serviced periodically through qualified personnel, the electric products don't require any or any significant maintenance. Due to these facts, electric tankers are to be more useful when compared to their gas counterparts. Therefore, the category is expected to grow at the fastest rate of CAGR.
However, the gas tankless heaters segment will grow at 8.4% CAGR during the projection period. As compared to electric tankless water heaters, gas tankless water heaters often do not need improvements to a home's fundamental utilities. In addition, gas tankless water heaters often have higher flow rates compared to electric water heaters. To avoid energy waste, a pilot light in a gas storage water heater heats up the water in the tank. Hence, it is preferred over electric heaters and is expected to grow at a steady CAGR during the duration of the forecast period.
Analysis By Application
Based on the 2024 tankless water heater market forecast, the residential sector dominated the market and is anticipated to grow at the fastest CAGR of 8.8% during the forecast period. The primary demand for energy-efficient and environmentally friendly products in the residential sector comes from the increasing use of such appliances, including tankless water heaters. It is also expected that during the forecast period, the growing middle class, especially in developing countries such as China and India, will increase the number of houses, which will drive the demand for these solutions. In addition, it is expected that new product launches will open new opportunities. For instance, the EcoNet Smart Technology available in Rheem's Prestige models offers Wi-Fi connectivity and add-on capabilities that enable control, system security, and cost savings.
Contrarily, the commercial segment is expected to grow at a CAGR of 8.5% over the forecast period. Throughout the forecast period, growing awareness of high-end products is expected to be the major driver for tankless water heater demand. For instance, Intellihot's tankless water heater reduces greenhouse gas emissions by more than 40.0% and eliminates energy waste and environmental effect by continuously providing hot water when needed. Furthermore, the tankless system includes two years of round-the-clock remote monitoring, with serviceable components sent proactively to the site, which encourages the business sector to use these systems.
Global Tankless Water Heater Market By Application
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Tankless Water Heater Market Regional Insights
In 2024, the tankless water heater market share of Europe was the highest because of the rising demand for cost-effective and energy-efficient products. Consumer demand for sustainable alternatives has significantly driven the demand for tankless water heaters. The growth is mainly being led by the business sector, which involves establishments such as hotels, restaurants, and hospitals. To cut down operational costs and ensure a constant water supply at high temperatures, these companies seek energy saving technologies. Countries such as Switzerland, Germany, and the UK have also led this trend in the adoption of tankless water heaters which has increased demand in the market. This trend is expected to continue and will drive further growth in the market across Europe.
During the forecast period, North America is expected to grow at the highest rate in the global tankless water heater industry, which will reach a projected CAGR of 10.2%. The growth in demand in the region can be attributed to increasing awareness of environmentally friendly products among consumers and the benefits that a tankless water heater provides for the environment. As these solutions reduce long-term utility costs and energy usage, energy-efficient solutions are growing increasingly popular among consumers. Well-known industry leaders in the region and aggressive marketing of tankless technology will drive the further development of the market. North America is to undergo significant market growth in the near future due to this increasing adoption rate.
Global Tankless Water Heater Market By Geography
- Largest
- Fastest
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Tankless Water Heater Market Dynamics
Drivers
Cost-effectiveness and Energy Efficiency
- The high energy efficiency of tankless water heaters drives their popularity. Since they heat only the required amount of water, they save 24% to 34% of energy compared to conventional tank heaters. Environment-conscious consumers who seek to reduce power costs will be interested in this saving capacity because of long-term cost benefits. The demand for energy-efficient products drives the demand in the market.
Convenience and Saving Space
- Unlike traditional big tanks, tankless water heaters are small and can fit in smaller spaces. This space-saving feature makes them very attractive to homeowners and businesses with limited space. These heaters also leave consumers with an endless supply of hot water, thereby maximizing consumer convenience and quality. Tankless water heaters grow in popularity in residential and industrial applications due to continuous production of hot water and lack of space.
Restraints
High Initial Installation Costs
- The main market barrier is that tankless water heaters are more expensive for installation than traditional water heaters. Tankless systems may be significantly more expensive upfront, but they save money in the long run. Adding to the overall cost is that installation may require modifications to the existing electrical and plumbing infrastructure. Some customers may be driven away from tankless water heaters by the higher initial price, thereby limiting market growth.
Low Flow Rate for Large Family
- Large homes or industrial buildings that require much hot water at one time might not be able to meet such needs with tankless water heaters. Even though modern systems have improved on this front, larger households or businesses that have several outlets using hot water simultaneously may still not be suitable for them. This limitation may limit further use in certain industries where high capacity is required.
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Tankless Water Heater Market Competitive Landscape
Leading companies in the highly competitive tankless water heater industry are Rinnai Corporation, A. O. Smith Corporation, Bosch Thermotechnology, Noritz America, and Vaillant Group. Businesses are focusing on innovation through eco-friendly and energy-efficient solutions with diversified product lines. Manufacturers will invest in smart features and cutting-edge technology, along with tailored solutions for home and business applications, to find a competitive advantage.
Top Player’s Company Profile
- Rinnai Corporation
- A. O. Smith Corporation
- Bosch Thermotechnology
- Noritz America
- Vaillant Group
- Takagi Industrial Co., Ltd.
- Ecosmart Inc.
- Stiebel Eltron
- Ferroli S.p.A.
- Ariston Thermo Group
- Eemax Inc.
- Paloma Industries Inc.
- Bradford White Corporation
- Atmor
- Boshung Ltd.
Recent Developments
- Under its electric tankless water heater category, Bosch Thermotechnology Corp., a leader in supplying the most advanced heating and cooling water systems, released in January 2023, for under-sink applications the Tronic 4000 C and for whole-house applications the Tronic 6100 C. These products do away with the requirement of having a storage tank and offer 100% electric hot water on demand.
- Rinnai-the tankless water heater manufacturer, introduced the New RE Series Tankless Water Heater with Smart-Circ Intelligent Recirculation in August 2022. The Wi-Fi module controller can be incorporated with the RE Series in order to offer on-demand or scheduled recirculation.
- The Kwick Shot is a tankless electric water heater that is durable and easy to install. It comes in thermostatic and non-thermostatic variants to accommodate a range of water temperature requirements in several daily uses. Bradford White Corporation developed it in January 2022.
Tankless Water Heater Key Market Trends
- Increasing Demand for Smart Features: The demand for tankless water heaters is being driven by the rise of smart home technologies, as more customers seek advanced features such as temperature monitoring, smartphone controls, and Wi-Fi connectivity. Such smart features enhance convenience and energy management by allowing consumers to control their water heating remotely. Smart technology-based tankless water heaters are predicted to rise in popularity as customers consider convenience and energy economy in household equipment the most important.
- Government Programs and Incentives: Government programs and incentives related to saving energy through energy-efficient equipment are gaining momentum in the market for tankless water heaters. Customers are installing energy-efficient equipment and collecting rebates, tax credits, and other incentives in different geographies. The tendency is more pronounced in areas where environmental rules are strict, the government is encouraging the use of environment-friendly products. The inducements followed by these governments through institutional and regulatory policies will boost the demand for tankless water heaters in the residential and commercial sectors.
Tankless Water Heater Market SkyQuest Analysis
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected using Primary Exploratory Research backed by robust Secondary Desk research.
As per SkyQuest analysis, the tankless water heater market is growing rapidly due to increasing customer demand for eco-friendly, space-saving, and energy-efficient products. These systems are in great demand among residential and commercial consumers, who want to minimize their energy expenses and decrease their ecological footprint. Some of the issues with these systems include a high startup cost and a low flow rate for big families. Technological advancements such as smart features and high energy efficiency will make tankless water heaters poised to take the lead in the business of water heating. Market growth is expected to occur rapidly as governments strengthen regulations and offer incentives for environmentally friendly products, thus offering huge growth opportunities for major industry players.
| Report Metric | Details |
|---|---|
| Market size value in 2023 | USD 3.85 Billion |
| Market size value in 2032 | USD 8.15 Billion |
| Growth Rate | 8.7% |
| Base year | 2024 |
| Forecast period | (2025-2032) |
| Forecast Unit (Value) | USD Billion |
| Segments covered |
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| Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
| Companies covered |
|
| Customization scope | Free report customization with purchase. Customization includes:-
|
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Table Of Content
Executive Summary
Market overview
- Exhibit: Executive Summary – Chart on Market Overview
- Exhibit: Executive Summary – Data Table on Market Overview
- Exhibit: Executive Summary – Chart on Tankless Water Heater Market Characteristics
- Exhibit: Executive Summary – Chart on Market by Geography
- Exhibit: Executive Summary – Chart on Market Segmentation
- Exhibit: Executive Summary – Chart on Incremental Growth
- Exhibit: Executive Summary – Data Table on Incremental Growth
- Exhibit: Executive Summary – Chart on Vendor Market Positioning
Parent Market Analysis
Market overview
Market size
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- SWOT Analysis
KEY MARKET INSIGHTS
- Technology Analysis
- (Exhibit: Data Table: Name of technology and details)
- Pricing Analysis
- (Exhibit: Data Table: Name of technology and pricing details)
- Supply Chain Analysis
- (Exhibit: Detailed Supply Chain Presentation)
- Value Chain Analysis
- (Exhibit: Detailed Value Chain Presentation)
- Ecosystem Of the Market
- Exhibit: Parent Market Ecosystem Market Analysis
- Exhibit: Market Characteristics of Parent Market
- IP Analysis
- (Exhibit: Data Table: Name of product/technology, patents filed, inventor/company name, acquiring firm)
- Trade Analysis
- (Exhibit: Data Table: Import and Export data details)
- Startup Analysis
- (Exhibit: Data Table: Emerging startups details)
- Raw Material Analysis
- (Exhibit: Data Table: Mapping of key raw materials)
- Innovation Matrix
- (Exhibit: Positioning Matrix: Mapping of new and existing technologies)
- Pipeline product Analysis
- (Exhibit: Data Table: Name of companies and pipeline products, regional mapping)
- Macroeconomic Indicators
COVID IMPACT
- Introduction
- Impact On Economy—scenario Assessment
- Exhibit: Data on GDP - Year-over-year growth 2016-2022 (%)
- Revised Market Size
- Exhibit: Data Table on Tankless Water Heater Market size and forecast 2021-2027 ($ million)
- Impact Of COVID On Key Segments
- Exhibit: Data Table on Segment Market size and forecast 2021-2027 ($ million)
- COVID Strategies By Company
- Exhibit: Analysis on key strategies adopted by companies
MARKET DYNAMICS & OUTLOOK
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- Regulatory Landscape
- Exhibit: Data Table on regulation from different region
- SWOT Analysis
- Porters Analysis
- Competitive rivalry
- Exhibit: Competitive rivalry Impact of key factors, 2021
- Threat of substitute products
- Exhibit: Threat of Substitute Products Impact of key factors, 2021
- Bargaining power of buyers
- Exhibit: buyers bargaining power Impact of key factors, 2021
- Threat of new entrants
- Exhibit: Threat of new entrants Impact of key factors, 2021
- Bargaining power of suppliers
- Exhibit: Threat of suppliers bargaining power Impact of key factors, 2021
- Competitive rivalry
- Skyquest special insights on future disruptions
- Political Impact
- Economic impact
- Social Impact
- Technical Impact
- Environmental Impact
- Legal Impact
Market Size by Region
- Chart on Market share by geography 2021-2027 (%)
- Data Table on Market share by geography 2021-2027(%)
- North America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- USA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Canada
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Europe
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Germany
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Spain
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- France
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- UK
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Europe
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Asia Pacific
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- China
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- India
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Japan
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Korea
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Asia Pacific
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Latin America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Brazil
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of South America
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Middle East & Africa (MEA)
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- GCC Countries
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Africa
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of MEA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
KEY COMPANY PROFILES
- Competitive Landscape
- Total number of companies covered
- Exhibit: companies covered in the report, 2021
- Top companies market positioning
- Exhibit: company positioning matrix, 2021
- Top companies market Share
- Exhibit: Pie chart analysis on company market share, 2021(%)
- Total number of companies covered
Methodology
For the Tankless Water Heater Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Tankless Water Heater Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
Analyst Support
Customization Options
With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Tankless Water Heater Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
Regional Analysis: Further analysis of the Tankless Water Heater Market for additional countries.
Competitive Analysis: Detailed analysis and profiling of additional Market players & comparative analysis of competitive products.
Go to Market Strategy: Find the high-growth channels to invest your marketing efforts and increase your customer base.
Innovation Mapping: Identify racial solutions and innovation, connected to deep ecosystems of innovators, start-ups, academics, and strategic partners.
Category Intelligence: Customized intelligence that is relevant to their supply Markets will enable them to make smarter sourcing decisions and improve their category management.
Public Company Transcript Analysis: To improve the investment performance by generating new alpha and making better-informed decisions.
Social Media Listening: To analyze the conversations and trends happening not just around your brand, but around your industry as a whole, and use those insights to make better Marketing decisions.
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