Thermal Systems Market Report 2025

The thermal systems market size has grown steadily in recent years. It will grow from $49.44 billion in 2024 to $51.62 billion in 2025 at a compound annual growth rate (CAGR) of 4.4%. The growth in the historic period can be attributed to growing industrialization, rise in energy consumption, government initiatives for energy efficiency, focus on environmental sustainability, expansion of the construction sector, increasing urbanization, adoption of combined heat and power (CHP).

The thermal systems market size is expected to see steady growth in the next few years. It will grow to $62.48 billion in 2029 at a compound annual growth rate (CAGR) of 4.9%. The growth in the forecast period can be attributed to shift towards electrification, growing adoption of geothermal heating and cooling, emergence of green building standards, strategic alliances in the industry, demand for temperature-controlled storage. Major trends in the forecast period include integration of renewable energy sources, advancements in heat pump technology, smart and connected thermal systems, energy storage solutions, district heating and cooling systems, advanced thermal insulation materials, waste heat recovery.

The growing demand for electric vehicles is expected to drive the expansion of the thermal systems market in the coming years. Known as battery electric vehicles (BEVs), these vehicles operate using an electric motor instead of an internal combustion engine. Thermal systems play a crucial role in maintaining optimal temperatures in battery packs, power electronics drives, and electric motors, while also managing both external and internal temperatures in electric vehicles. For example, in March 2023, the International Energy Agency, a France-based intergovernmental organization, reported that the electric car market witnessed significant growth in 2022, with sales exceeding 10 million units. Electric vehicles accounted for 14% of all new car sales, an increase from around 9% in 2021. Therefore, the rising demand for electric vehicles is driving the growth of the thermal systems market.

The trend of increasing urbanization is expected to enhance the growth of the thermal systems market in the future. Urbanization refers to the concentration of populations in specific geographic areas. The demand for heating, ventilation, and air conditioning (HVAC) systems, along with thermal management solutions for buildings and infrastructure, is rising due to urbanization, thus driving the demand for thermal systems. For instance, a report published by the World Bank, a US-based international organization, stated that in 2022, over 50% of the global population lived in urban areas. The number of individuals residing in urban regions is projected to reach 6 billion by 2045, representing a 1.5-fold increase. By 2030, it is estimated that the world will gain an additional 1.2 million km² of urban built-up area, with urban land consumption expected to grow at a rate up to 50% faster than population growth. Therefore, the ongoing urbanization is propelling the growth of the thermal systems market.

Technological advancements stand out as a key trend in the thermal systems market, with major companies introducing innovative technologies to sustain their market position. A notable example is Alfalevel, a Sweden-based provider of products in the areas of separation, heat transfer, and fluid handling, launching the E-PowerPack in April 2022. The E-PowerPack generates power from waste heat, allowing for energy savings and compliance. Leveraging Organic Rankine Cycle (ORC) technology, the E-PowerPack converts waste heat into clean electrical power, accommodating a range of heat sources from jacket cooling water at 75°C to engine exhaust gas at 550°C. Its modular approach enables the integration of smaller units into larger systems, offering flexibility and efficiency in energy generation. This technological innovation contributes to the advancement of the thermal systems market.

Prominent companies in the thermal system market are actively engaged in developing innovative products, including advanced thermal management systems, as part of strategic efforts to expand their customer base, boost sales, and increase overall revenue. Thermal management systems refer to devices or processes designed to maintain a desired temperature within a specific environment. A noteworthy example is Modine Manufacturing Company, a US-based thermal technology provider, which introduced the EVantage Thermal Management Systems for commercial electric vehicle (EV) chassis in May 2022. This product line includes the EVantage Battery Thermal Management System (BTMS) and the EVantage Electronics Cooling Package (ECP). The EVantage BTMS is designed to regulate battery temperatures across diverse environmental conditions, utilizing multi-stage cooling and heating to manage the temperature range for an entire battery bank with a single unit while minimizing power consumption. Meanwhile, the EVantage ECP focuses on ensuring optimal performance for traction motors and power electronics. It employs multi-zone cooling to maintain optimal fluid temperatures for these critical components, with fan arrays operating only as needed to conserve energy.

In August 2023, Mission Critical Group (MCG), a US-based provider of electrical equipment solutions, acquired Johnson Thermal Systems (JTS) for an undisclosed amount. This strategic acquisition positions JTS to continue delivering integrated design and manufacturing solutions while gaining access to the comprehensive system design, application engineering, manufacturing, on-site professional services, and ongoing support capabilities offered by the broader MCG platform. Johnson Thermal Systems, a US-based provider of thermal solutions, brings valuable expertise and capabilities to the MCG portfolio, enhancing their position in the thermal systems market.

Major companies operating in the thermal systems market are Continental AG, Denso Corporation, Dana Incorporated, Grayson Thermal Systems, Gentherm Inc., Hanon Systems, Lennox International Inc., Modine Manufacturing Company Inc., MAHLE GmbH, Robert Bosch GmbH, Valeo SA, Visteon Corporation, Schaeffler Technologies AG & Co. KG, Johnson Electric Holding Ltd., Sanden Corp., Diakin Industries Ltd., Calsonic Kansei Corp., BorgWarner Inc., ZF Friedrichshafen AG, Honeywell International Inc., Parker Hannifin Corporation, Siemens AG, Aavid Thermalloy LLC, Advanced Cooling Technologies Inc., Boyd Corporation, Delta Electronics Inc., Laird Technologies Inc., Lytron Inc., Nortek Air Solutions LLC, Thermacore Inc., Thermotek Inc., Vertiv Co., Wakefield-Vette Inc.

North America was the largest region in the thermal systems market in 2024. The regions covered in the thermal systems market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the thermal systems market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

A thermal system is a complex assembly comprising interlinked components, some of which operate thermally, collaborating to generate internal cold while demonstrating a unified and organized behavior.

The primary constituents of the thermal system include an air filter, condenser, compressor, water pump, motor, heat exchanger, heater control, thermoelectric generator, and other essential elements used across different vehicle types like ICE, electric, off-vehicle, and ATV. Air filters function as devices aimed at purifying the air by removing harmful airborne particles, which have adverse effects on both the environment and human health. These components find applications in various vehicle systems such as front and rear A or C, powertrain, seat, steering, battery, motor, power electronics, waste heat recovery, and sensor technologies.

The thermal systems market research report is one of a series of new reports that provides thermal systems market statistics, including thermal systems industry global market size, regional shares, competitors with thermal systems market share, detailed thermal systems market segments, market trends, and opportunities, and any further data you may need to thrive in the thermal systems industry. This thermal systems market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The thermal systems market includes revenues earned by entities by Egr valve, A/C valve, oxygen sensor, temperature sensor, and charge air cooler. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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