The variable frequency Drive market size is projected to reach US$ 34.01 billion by 2031 from US$ 22.03 billion in 2023. The market is expected to register a CAGR of 5.6% during 2023–2031. The growing digitalization and government initiatives to promote the adoption of energy-efficient solutions are likely to remain key trends in the market.
A variable frequency drive (VFD) is a type of motor controller that regulates the frequency and voltage of an electric motor's power supply. The VFD can also control the motor's ramp-up and ramp-down during start and stop cycles, respectively. Even though the drive regulates the frequency and voltage of power supplied to the motor, it is commonly referred to as speed control because the consequence is an adjustment of motor speed. A few of the major reasons why VFDs are preferred over other motor controlling technologies, such as soft starters and across-the-line contactors, are: save energy and increase system efficiency, convert electricity for hybridization purposes, match the speed of the drive with the process requirements, match the torque or power of a drive with the process requirements, improve the work environment, reduced noise levels, such as from fans and pumps. These applications are the reason for the rising variable frequency drive market share in the overall motor control market. Energy saving is the most important factor considered when selecting VFDs for motor-driven systems. In the current market, fans, pumps, and compressor applications hold a major chunk of the variable frequency drive market forecast.
One of the major factors driving the variable frequency market growth is the need for energy savings in drive control systems used in industries. VFDs can dramatically cut energy use, lowering production costs. VFDs control pumps and fans in a system using an alternating current motor rather than valves and dampers. In the US, rotating machinery consumes 50% of the total electrical energy generated. Current estimates indicate that centrifugal or flow-related applications, such as fans, blowers, compressors, and pumps, require 65% of the total. Variable speed drive technology is a cost-effective way to tailor driver speed to load needs, resulting in lower operating costs and increased productivity. Major energy consumers such as chemical industries, oil and gas industries, refiners, automotive industries, and others are constantly investing in improving energy consumption. These industries are expected to be in a better position to replace conventional motor control systems with VFD. Variable frequency drives are predefined solutions for some applications, such as extruders, bigger reciprocating pumps, displacement pumps, and large agitators (up to 1 kW). However, in other applications, the use of variable frequency drives is proposed and investigated. If the machines are routinely operated at partial load, the savings potential increases. Individually, the use of a VFD can cut energy expenses by 40%.
Also, the variable frequency drive market is witnessing digital trends. Wireless diagnostics represent the future of VFDs, whether they are Wi-Fi, Bluetooth, or something else entirely. In a typical facility where access to a drive in a closed enclosure is limited, engineers can use the drive's wireless signal to connect directly to the system from a distance. The Internet of Things (IoT), a global trend across all industries, has had an impact on VFDs by speeding up and simplifying the flow of data from machine to technician and back. These variable frequencies drive market trends and further generate potential for the growth of the market.
VFDs are very beneficial for centrifugal loads like pumps and fans. Variable-loaded air compressors (usually rotary screw type), boiler and chiller feedwater pump motors, cooling tower fans, air handler supply and return fans, exhaust fans, and others are common commercial and industrial VFD uses. VFDs are especially useful in applications with long working hours since there are more opportunities to harvest energy savings and offset the cost of the equipment. Variable frequency drives (VFDs) are increasingly used in the HVAC sector for a variety of applications. They can control the motor speed very smoothly across a large range. Reduced motor speed leads to a considerable loss in motor power. VFDs have been used in building HVAC systems for more than 4 decades. However, variable frequency drives have only recently been implemented in a growing number of HVAC systems within buildings, owing to their improved energy-saving characteristics. The global HVAC industry is growing with a CAGR of about 8%. This rise in the HVAC market will significantly impact the variable frequency drive market trends as these are being increasingly used for energy efficiency in these systems. The variable frequency drive market report emphasizes such key factors driving the market and prominent players' developments.
Industries across the globe are transforming their operations towards the adoption of sustainable and energy-efficient infrastructure for mitigating and reducing environmental impact. This increases the demand for variable frequency drives for enhancing energy efficiency in industrial processes. Industries increasingly demand variable frequency drives for precisely controlling motor speed and power consumption. Moreover, numerous industries such as infrastructure, power generation, industrial, oil and gas, and others are adopting variable frequency drives for ensuring precise temperature and ventilation, navigating complex terrain, and optimizing operations by promoting energy efficiency. These factors are anticipated to create significant growth opportunities for the market during the forecast period.
Key segments that contributed to the derivation of the variable frequency drive market analysis are type, voltage, application, and end user.
The geographic scope of the variable frequency drive market report is mainly divided into five regions: North America, Asia Pacific, Europe, Middle East & Africa, and South & Central America.
Asia Pacific holds one of the largest global variable frequency drive market share. Asia Pacific is the manufacturing hub of the world. Countries such as China, Japan, South Korea, and India, among others, are at the forefront of manufacturing activities and industrial investments. For instance, foreign direct investment in China's manufacturing industry increased by 1.9 percent year on year to 283.44 billion yuan (US$39.47 billion) in the first 10 months of 2023, while high-tech manufacturing increased by 9.5 percent, according to China's Ministry of Commerce data. Similarly, according to the 8th annual "State of Smart Manufacturing Report" by Rockwell Automation, a major share of manufacturers in India are investing in advanced technologies. Manufacturers in India invest 35% of their operational budgets in technology, outpacing the global average (23%) and countries such as the United States (27%) and Japan (24%).
Major manufacturers in the Asia Pacific are increasingly turning their focus on energy-efficient operations in their manufacturing establishments. This initiative creates a potential for the variable frequency to drive market growth in this region. Some of the instances signifying this trend are,
In 2021, ADB approved a new energy policy to assist developing member countries (DMCs) in accelerating Asia-Pacific's low-carbon transition. The energy strategy identifies a number of major priorities and technologies that our DMCs should investigate, notably those related to energy efficiency and renewable energy.
The regional trends and factors influencing the Variable Frequency Drive Market throughout the forecast period have been thoroughly explained by the analysts at Insight Partners. This section also discusses Variable Frequency Drive Market segments and geography across North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America.
| Report Attribute | Details |
|---|---|
| Market size in 2024 | US$ 23.26 Billion |
| Market Size by 2031 | US$ 34.01 Billion |
| Global CAGR (2025 - 2031) | 5.6% |
| Historical Data | 2021-2023 |
| Forecast period | 2025-2031 |
| Segments Covered |
By Type
|
| Regions and Countries Covered | North America
|
| Market leaders and key company profiles |
The Variable Frequency Drive Market market is growing rapidly, driven by increasing end-user demand due to factors such as evolving consumer preferences, technological advancements, and greater awareness of the product's benefits. As demand rises, businesses are expanding their offerings, innovating to meet consumer needs, and capitalizing on emerging trends, which further fuels market growth.
Market players density refers to the distribution of firms or companies operating within a particular market or industry. It indicates how many competitors (market players) are present in a given market space relative to its size or total market value.
Major Companies operating in the Variable Frequency Drive Market are:
Disclaimer: The companies listed above are not ranked in any particular order.
The variable frequency drive market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. A few of the developments in the variable frequency drive market are listed below:
The “Variable Frequency Drive Market Size and Forecast (2021–2031)” report provides a detailed analysis of the market covering below areas:
Some of the customization options available based on the request are additional 3–5 company profiles and country-specific analysis of 3–5 countries of your choice. Customizations are to be requested/discussed before making final order confirmation, as our team would review the same and check the feasibility.
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The key players holding majority shares in the global variable frequency drive market are Fuji Electric Co., Ltd, Mitsubishi Electric Corporation, Siemens AG, ABB Ltd., American Electric Technologies Inc. (AETI), General Electric Company, Hitachi Limited, Honeywell International Inc., Rockwell Automation Inc., and Johnson Controls Inc.
The growing digitalization and government initiatives to promote the adoption of energy-efficient solutions to play a significant role in the global variable frequency drive market in the coming years.
The global variable frequency drive market is estimated to register a CAGR of 5.6% during the forecast period 2023–2031.
Expanding industries and increasing application in HVAC systems are the major factors that propel the global variable frequency drive market.