Automotive Thermal System Market Report 2025

The automotive thermal system market size has grown strongly in recent years. It will grow from $42.15 billion in 2024 to $44.29 billion in 2025 at a compound annual growth rate (CAGR) of 5.1%. The growth in the historic period can be attributed to integration of autonomous features, focus on vehicle safety, globalization of automotive industry, rise in demand for advanced cooling systems, climate control and passenger comfort.

The automotive thermal system market size is expected to see strong growth in the next few years. It will grow to $56.28 billion in 2029 at a compound annual growth rate (CAGR) of 6.2%. The growth in the forecast period can be attributed to stricter emission standards, advancements in electric vehicle technologies, growth in climate control requirements. Major trends in the forecast period include electrification and hybridization, advanced engine technologies, adoption of advanced cooling solutions, innovations in materials and insulation, globalization and standardization.

The tightening of emission regulations enforced by governing bodies is anticipated to drive the growth of the automotive thermal systems market in the future. With the increase in the number of vehicles on the road globally, controlling greenhouse gas (GHG) emissions has become a significant challenge. Regulatory organizations such as the European Commission (EC) and the United States Environmental Protection Agency (US EPA) have implemented fuel economy standards and set limits on fuel sulfur content to mitigate the escalating impact of emissions. For example, in September 2023, the Environmental Protection Agency (EPA), a US-based independent executive agency focused on environmental protection, reported that the average exposure indicator (AEI) for automotive emissions of nitrogen oxides (NOx) was 0.04 g/km in 2022. The Environmental Targets (Automotive Emissions) (England) Regulations (2023) have established a legally binding target of 0.03 g/km for annual mean NOx emissions by 2040, with interim targets to be achieved by January 2028. Thus, the strict emission regulations set by governing agencies are propelling the growth of the automotive thermal systems market.

The expanding electric vehicle market is projected to boost the growth of automotive thermal systems in the future. An electric vehicle is an automobile powered by electricity, typically using one or more electric motors instead of an internal combustion engine that relies on gasoline or diesel. Automotive thermal systems in electric vehicles are crucial for managing battery temperature, ensuring optimal operating conditions for electric motors, and enhancing the overall efficiency of EVs. For instance, in October 2023, the European Environment Agency, a Denmark-based government agency, noted that the number of battery electric cars registered in Europe reached 1,126,682 in 2022, reflecting a 28.35% increase compared to 878,092 cars registered in 2021. Therefore, the growing electric vehicle market is contributing to the expansion of the automotive thermal systems market.

The advancement of automotive thermal systems is a significant trend gaining traction in the automotive thermal systems market. Ongoing research and development efforts aim to create innovative thermal systems for the automotive sector. Key players in the automotive thermal systems market are concentrating on developing new technological solutions to enhance their market position. For example, in September 2023, Mitsubishi Heavy Industries Thermal Systems, Ltd., a company based in Japan, introduced the TEJ35GAM electric-driven transport refrigeration units, which complement the existing TE20/30 series and the TEJ35AM lineup. The TEJ35GAM incorporates a plug-in hybrid system that merges a commercial plug-in power source with a dedicated power source for the refrigerator, offering an innovative approach to transport refrigeration.

Leading companies in the automotive thermal systems market are increasingly focused on developing innovative products, such as advanced thermal management systems, to secure a competitive advantage in the industry. Advanced thermal management systems (ATMS) are sophisticated cooling solutions tailored to address the growing complexity of heat dissipation needs in modern electronic devices and systems. For instance, in September 2023, Modine Manufacturing, a thermal management company based in Japan, launched a new line of thermal management systems for commercial electric vehicles called EVantage. These systems are designed to regulate the temperature of electric vehicles, ensuring optimal performance for batteries, traction motors, and power electronics across various operating conditions. The EVantage systems can be tailored to fit any vehicle size, suitable for land, marine, aviation, and stationary applications. Modine's thermal management products are particularly well-suited for zero-emission transit, coach, and school buses, specialty vehicles, and trucks, including vans used for last-mile delivery.

In February 2022, BorgWarner Inc., a US-based manufacturer and distributor of automotive components, executed an undisclosed acquisition of Akasol AG. This strategic acquisition is poised to significantly enhance BorgWarner's capabilities in industrial electrification and commercial vehicles. Akasol AG, a German-based entity specializing in automotive thermal systems, aligns with BorgWarner's strategic objectives in fortifying their presence and expertise in this domain.

Major companies operating in the automotive thermal system market are Continental AG, Denso Corporation, Dana Incorporated, Grayson Thermal Systems, Gentherm Incorporated, Hanon Systems, Lennox International Inc., Modine Manufacturing Company Inc., Mahle Behr GmbH & Co. KG, Robert Bosch GmbH, Valeo SA, Visteon Corporation, Calsonic Kansei Corp., Schaeffler Technologies AG & Co. KG, Johnson Electric Holdings Limited, Diakin Industries Ltd., Sanden Corporation, United Technologies Corporation, BorgWarner Inc., Marelli Corporation, Behr GmbH & Co KG, Delphi Technologies, Eberspaecher Group, Hella GmbH & Co KGaA, Siemens AG, Webasto SE, ZF Friedrichshafen AG, Bergstrom Inc., Kongsberg Automotive.

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

An automotive thermal system refers to a technological framework employed in automobiles to regulate and control temperature. This system is instrumental in managing the temperature of various vehicle components, thereby minimizing temperature fluctuations and monitoring engine block temperatures.

The primary categories of automotive thermal systems include compressors, HVAC (Heating, Ventilation, and Air Conditioning), powertrain cooling, and fluid transport. The compressor functions as the engine that powers the air conditioner, exerting high pressure on the refrigerant to transform it from a gas to a liquid before pumping it into the condenser. This transformation is crucial for the efficient functioning of the air conditioning system. These thermal systems cater to a range of vehicle types, including passenger cars, light commercial vehicles, heavy commercial vehicles, and others. Their applications extend to front and rear air conditioning, engine and transmission cooling, seat temperature regulation, battery temperature management, motor cooling, waste heat recovery, and power electronics temperature control.

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