Automotive Thermal System Market Report 2026

The automotive thermal system market size has grown strongly in recent years. It will grow from $43.71 billion in 2025 to $46.11 billion in 2026 at a compound annual growth rate (CAGR) of 5.5%. The growth in the historic period can be attributed to engine cooling demand, hvac system adoption, internal combustion engine dominance, passenger vehicle growth, thermal comfort requirements.

The automotive thermal system market size is expected to see strong growth in the next few years. It will grow to $57.57 billion in 2030 at a compound annual growth rate (CAGR) of 5.7%. The growth in the forecast period can be attributed to electric vehicle penetration, battery safety regulations, smart thermal analytics, energy-efficient hvac demand, autonomous vehicle electronics cooling. Major trends in the forecast period include shift toward battery thermal management, adoption of electrically driven compressors, integration of smart thermal controls, growth of waste heat recovery systems, demand for lightweight cooling components.

The expanding electric vehicle market is expected to drive the growth of automotive thermal systems in the coming years. Electric vehicles are powered by electricity, typically via one or more electric motors, instead of internal combustion engines that rely on gasoline or diesel. Automotive thermal systems in EVs are crucial for managing battery temperature, ensuring optimal conditions for electric motors, and improving overall vehicle efficiency. For instance, in April 2024, the International Energy Agency (IEA), a France-based intergovernmental organization, reported that new electric car registrations in China reached 8.1 million in 2023, marking a 35% increase compared to 2022. Therefore, the growth of the electric vehicle market is supporting the expansion of the automotive thermal systems market.

Key players in the automotive thermal systems market are focusing on developing innovative solutions, such as advanced thermal management systems, to strengthen their competitive position. Advanced thermal management systems (ATMS) are sophisticated cooling solutions designed to meet the complex heat dissipation needs of modern electronic systems. For example, in September 2023, Modine Manufacturing, a Japan-based thermal management company, launched a new line of thermal management systems for commercial electric vehicles called EVantage. These systems regulate temperatures to ensure optimal performance of batteries, traction motors, and power electronics under varying operating conditions. EVantage systems can be customized for vehicles of all sizes across land, marine, aviation, and stationary applications. Modine’s products are suitable for zero-emission transit, coach, and school buses, specialty vehicles, trucks, and vans used in last-mile delivery.

In January 2025, Hankook & Company Group, a South Korea-based battery manufacturer, acquired Hanon Systems for an undisclosed amount. Through this acquisition, Hankook aims to complete its mobility portfolio by integrating tire, battery, and thermal-management capabilities, strengthening its position in the electric vehicle and future mobility sectors. Hanon Systems is a South Korea-based provider of automotive thermal and energy management systems for both electrified and conventional vehicles.

Major companies operating in the automotive thermal system market report include Continental AG, Denso Corporation, Dana Incorporated, Grayson Thermal Systems, Gentherm Incorporated, Hanon Systems, Modine Manufacturing Company Inc., Mahle Behr GmbH & Co. KG, Robert Bosch GmbH, Valeo SA, Visteon Corporation, Calsonic Kansei Corp., Sanden Corporation, BorgWarner Inc., Marelli Corporation, Behr GmbH & Co KG, Delphi Technologies, Eberspaecher Group, Hella GmbH & Co KGaA, Webasto SE, ZF Friedrichshafen AG, Bergstrom Inc., Kongsberg Automotive.

Asia-Pacific was the largest region in the automotive thermal systems market share in 2025. Europe is expected to be the fastest-growing region in the forecast period. The regions covered in the automotive thermal system market report include Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the automotive thermal system market report include Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The automotive thermal system market consists of revenues earned by entities by providing vehicles temperature monitoring performance, environmental simulation management. The market value includes the value of related goods sold by the service provider or included within the service offering. The automotive thermal system market also includes sales of heat pump systems and flexheaters. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors, and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

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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