Variable Frequency Drive Market Research, 2031
The global variable frequency drive market size was valued at $20.6 billion in 2021, and variable frequency drive industry is projected to reach $33.6 billion by 2031, growing at a CAGR of 5.1% from 2022 to 2031.
Variable frequency drive is used for regulating the voltage and frequency of electrical motors. It reduces power consumption and increases the efficiency of the electrical equipment. It is utilized in a diverse set of industries such as power, commercial buildings, chemical, petrochemical, mining, oil & gas, and others. It does not require high maintenance and thus saves a lot of operation time which is crucial in industries such as oil & gas, where delays can lead to depreciation in profits. It enables consistency in production of oil throughout the year. It can help achieve reduced flow by providing variable speed pump operation. This results in reduced system of pressure and operation near the best efficiency point of the pump. In addition, maintenance costs might be reduced.
The global variable frequency drive industry is expected to witness significant growth mainly due to surge in demand for efficient energy utilization of electrical equipment such as motors, pumps, fans, and others. Variable frequency drives are utilized with electric motors for change in the applied voltage which is supplied to the motor. They adjust the fan speed of the motor and reduce the power requirement exponentially as the power required is only consumed by electrical equipment such as motors when a variable frequency drive is utilized. Increase in adoption of variable frequency drive technologies such as Industrial Internet of Things (IIOT) is expected to have positive impact on the market growth. Technicians are anticipated to control the frequency from remote places. It is expected that VFD’s manufacturer’s introduce real-time monitoring, visual control, and predictive maintenance technology. The system can predict the need of maintenance of the drive when the chances of equipment failure are high. These features are speculated to improve the domain of operational efficiency, mass customization, remote diagnostics, and others. These factors are expected to create new scope of opportunities for the global variable frequency drive market during the forecast period.
Variable frequency drives are majorly utilized for commercial purposes in domains such as electrical turbines in powerplants, pumps in oil & gas industry, compressors in water filtration system of commercial buildings, and others for speed, motion, and torque control of the electrical equipment. Large variable frequency drives are costly and the cost of setup of variable frequency drive includes end-to-end services from installation to after-sale services. High cost is projected to hamper the variable frequency drive market growth during the forecast period.
The variable frequency drive market forecast is segmented on the basis of type, voltage type, power rating, application, end use and region. On the basis of type, it is divided into AC drive, DC drive, and servo drive. On the basis of voltage type, the market is bifurcated into low and medium. On the basis of power rating, the market is categorized into micro, low, medium, and high. On the basis of application, the market is segregated into pumps, conveyors, fans, compressors, and others. On the basis of end use, the market is segmented into oil & gas, industrial, power, and infrastructure. On the basis of region, the market is studied across North America, Europe, Asia-Pacific, and LAMEA. Presently, Asia-Pacific accounts for the largest variable frequency drive market share, followed by North America and Europe.
On the basis of type, the AC drive segment dominates the global variable frequency drive market. Variable-frequency drive (VFD) is a type of motor drive used in electro-mechanical drive systems to control AC motor speed and torque by varying motor input frequency and, depending on topology, to control associated voltage or current variation. AC drives are used in different sectors, such as power generation, oil & gas, food & beverages, and metal & mining. Rapid industrialization across the globe has led to increase in the investment of manufacturing facilities. Increase in population in the developed and developing countries has led to surge in demand for various consumer products which further lead to automation of industrial facilities. Rapid development in the manufacturing facilities of above-mentioned products is anticipated to provide ample opportunities for the development of the market.
On the basis of voltage type, the low voltage segment dominates the global variable frequency drive market. Low voltage variable frequency drives are used in many applications such as pumps, fans, belt conveyors, centrifugal pumps, and centrifugal compressors. The presence of utilization of belt conveyors and centrifugal pumps and compressors in various industries such as oil & gas, water & wastewater, mining & metal, power generation, chemicals, pharmaceuticals, pulp & paper, agriculture, automotive, food & beverage, textiles industries is expected to drive the demand for low voltage VDFs. The above-mentioned application of pumps, conveyors and compressors in various industries is anticipated to provide ample opportunities for the development of the market during the forecast period.
On the basis of power rating, the medium drive segment dominates the global variable frequency drive market. Medium power rating variable frequency drives are used with medium voltage electric equipment such as HVAC system, exhaust fans, in conveyor belts and other equipment which are used in various industries. Increase in global warming has led to surge in utilization of HVAC systems in the residential, commercial and industrial buildings. Surge in automation across various industries is expected to increase the demand for power. Variable frequency drives are used to improve the efficiency and reduce the power consumption. Rapid development in the manufacturing facilities of above-mentioned products is projected to provide ample opportunities for the development of the market.
On the basis of application, the pump segment dominates the global variable frequency drive market. A pump is a device that moves fluids, or sometimes slurries, by mechanical action, typically converted from electrical energy into hydraulic energy. Variable frequency drive (VFD) is used in pumps to achieve reduced flow by providing variable speed pump operations; which results in reduce system pressure and operation. Increase in utilization of centrifugal pumps in industrial and commercial applications is a major factor which drives the market growth. Increase in investments in construction industry attributing to rapid urbanization, and high demand for centrifugal pumps in the agricultural sector are the key factors that drive the growth of the variable frequency drive market. Rapid development in the manufacturing facilities is anticipated to provide ample opportunities for the development of the market.
On the basis of end use, the oil & gas segment dominates the global variable frequency drive market. The oil & gas sector uses heavy pumps and motors at the production site for various applications such as extraction, pumping, distribution, and others. Integrating variable frequency drive with the motors helps in increasing the output by lowering the energy consumption. Thus, approach of the players toward maximizing profit by enhancing efficiency is expected to fuel the demand for variable frequency drive. The demand for variable frequency drives in this industry is linked to the exploration, development, and production activities, as well as the capital spending by oil and natural gas companies. The presence of above-mentioned advantages is projected to drive the growth of the market.
Most of the countries in Asia-Pacific primarily rely on the agriculture and food industries. The use of variable frequency drives on food processing systems and equipment such as conveyors, pumps, mixers, compressors, and other equipment not only saves the energy, but by precisely controlling motor speed, it also enables the fine-tuning and precise control of food preparation, transfer, and packaging processes. The investment in the Asia-Pacific region has been higher, owing to the opportunities arising from relatively higher infrastructure and economic development in the region. Rapid technological advancement has led to higher acceptability of the drives in several industries. The advances are focused on high reliability and reduced energy costs which can potentially reduce the per square foot energy by 30-40% when equipped with motor-driven systems in commercial buildings. The above-mentioned policies and investments are major factors expected to drive the growth of the market in this region during the forecast period.
The major companies profiled in this report include ABB Ltd, Siemens, Danfoss, Schneider Electric, General Electric, Hitachi, Honeywell Intenational, Nord Drive Systems, Techsuppen, CG Power, Saksun Industries, A.S. Automation, Parker Hannfin, Sew-Eurodrive, Rockwell Automation, Fuji Electric, and Delta Electronics. Additional growth strategies such as expansion of production capacities, acquisition, partnership and research & innovation in the detection technologies have led to attain key developments in the global variable frequency drive market trends.
Impact of Covid-19 on Global Variable Frequency Drive Market
The global COVID-19 pandemic has negative impact on the variable frequency drive market. This market has experienced lower than anticipated demand across all regions compared to pre-pandemic levels. Variable frequency drive is mostly dependent on the demand for electric motor. The production of electric motor witnessed a significant negative near-term impact of the COVID-19 pandemic due to supply chain disruptions. Industry players anticipate delivery and construction slowdowns, either due to the shutdown of industrial operations to curb the spread of the virus or because the workers have tested positive. Many components and parts used in the manufacturing of electric motors are procured from China, the U.S., and some European countries. The decline in manufacturing activities in China and the U.S. has hampered the production of variable frequency drives in the past 2 years.
Post pandemic, the market is expected to recover due to eased lockdown restrictions in most nations. Furthermore, the governments of various countries across the globe have issued policies regarding sustainable development in coming years which is projected to have positive impact on the market. The presence of investment in the sustainable oil & gas production plant facilities in the developing countries such as India and China due to low availability of fossil fuel resources lead to surge in the market growth after the pandemic.
Key Benefits For Stakeholders
- This report provides a quantitative analysis of the market segments, current trends, estimations, and dynamics of the variable frequency drive market analysis from 2021 to 2031 to identify the prevailing variable frequency drive market opportunities.
- The market research is offered along with information related to key drivers, restraints, and opportunities.
- Porter's five forces analysis highlights the potency of buyers and suppliers to enable stakeholders make profit-oriented business decisions and strengthen their supplier-buyer network.
- In-depth analysis of the variable frequency drive market segmentation assists to determine the prevailing market opportunities.
- Major countries in each region are mapped according to their revenue contribution to the global market.
- Market player positioning facilitates benchmarking and provides a clear understanding of the present position of the market players.
- The report includes the analysis of the regional as well as global variable frequency drive market trends, key players, market segments, application areas, and market growth strategies.
Variable Frequency Drive Market Report Highlights
Market Size By 2031
USD 33.6 billion
CAGR of 5.1%
2021 - 2031
By End use
By Voltage type
By Power rating
Key Market Players
Sauer-Danfoss Inc., CG Power, Hitachi,Ltd, Siemens AG, ABB Ltd, Sew-Eurodrive, A.S. Automation, Nord Drive Systems, Techsuppen, Fuji Electric, Schneider Electric, General Electric, Saksun Industries, Delta Electronics, Rockwell Automation, Parker Hannifin Corporation, Honeywell Intenational
According to CXO perspective, the global variable frequency drive (VFD) market is expected to witness increased demand during the forecast period. Surge in utilization of variable frequency drive in industrial facilities, penetration of Internet of Things (IoT) and presence of major advantages such as regulating the loss of power are some factors anticipated to drive the growth of the variable frequency drive market.
There is a rise in usage of variable frequency drives in the industrial and infrastructure sectors. Major industries that use variable frequency drives are cement, chemical, petrochemical, mining, oil & gas, pulp & paper, and water & wastewater treatment. Variable frequency drives find applications in conveyors, fans, utility pumps, process pumps, fans, blowers, air compressors, process compressors, coolers, cooling tower fans, grinders, crushers, and chippers.
According to the Industrial Efficiency Technology database, more than 300 million motors are used in various industries, large buildings, and infrastructures globally, and 30 million new electric motors are sold every year for industrial purposes. Variable frequency drives have the potential to significantly save energy and reduce operational costs for a variety of motor-driven applications by reducing the motor speed to match the needs of the application. Increase in industrialization and rise in demand for energy efficiency are expected to fuel the demand for variable frequency drives and fuel the market growth.
Asia-Pacific is expected to be the fastest growing regional market during the forecast period due to increase in investments in infrastructure development in developing countries such as India and China.