Tankless Water Heater Market Grow with a CAGR of 8.38% through 2030

The global tankless water heater market is driven by rising demand for energy-efficient, space-saving appliances, offering on-demand hot water, reduced standby energy loss, and longer lifespan compared to traditional storage models

According to TechSci Research report, “Tankless Water Heater Market - Global Industry Size, Share, Trends, Competition Forecast & Opportunities, 2030F”, the Global Tankless Water Heater Market was valued at USD 3.78 billion in 2024 and is expected to grow to USD 6.11 billion by 2030 with a CAGR of 8.38% during the forecast period. The global tankless water heater market is experiencing steady growth, driven by increasing consumer preference for energy-efficient and space-saving water heating solutions. Unlike traditional storage water heaters, which continuously heat and store large volumes of water, tankless systems operate on an on-demand basis, heating water only when required. This not only eliminates standby energy losses but also reduces utility costs, making them an attractive option for both residential and commercial users. As sustainability becomes a higher priority among households and businesses, the demand for appliances that minimize environmental impact while delivering high performance is rising, positioning tankless water heaters as a compelling choice.

One of the major advantages contributing to the market’s expansion is the compact and flexible design of tankless water heaters. Their wall-mounted construction and smaller footprint allow for installation in tight spaces such as kitchens, bathrooms, or utility closets. This adaptability is particularly beneficial in modern housing, where space optimization is critical. Additionally, the sleek and modern designs of many models appeal to consumers seeking appliances that blend seamlessly with contemporary home aesthetics. This space efficiency extends beyond residential applications, as commercial establishments with limited utility space also benefit from the installation flexibility offered by these systems.

Another factor fueling market growth is the extended lifespan and reliability of tankless systems compared to conventional storage heaters. With proper maintenance, these units can operate efficiently for up to 20 years or more, significantly longer than the typical 8–12 years of storage water heaters. This durability provides consumers with long-term cost savings and a reduced need for frequent replacements. Furthermore, tankless water heaters are less susceptible to corrosion, leaks, and sediment buildup since they do not store standing water. This reliability is especially important for commercial operations such as hotels, gyms, and restaurants, where consistent hot water supply is essential to daily operations.

The environmental and cost-saving benefits of tankless water heaters are also being reinforced by supportive policy frameworks in many countries. Governments and regulatory bodies are introducing energy efficiency standards, labeling requirements, and financial incentives to encourage the adoption of high-efficiency appliances. Rebates, tax credits, and low-interest financing programs are making it easier for homeowners and businesses to invest in tankless systems despite the higher upfront costs. Such initiatives not only accelerate adoption but also help manufacturers expand their market reach.

However, the market is not without its challenges. The initial purchase and installation costs for tankless water heaters remain higher than for traditional storage systems, which can deter budget-conscious consumers. Installation often requires specialized labor, plumbing modifications, and, in the case of gas units, upgraded venting systems. Even electric models may require electrical system upgrades in certain applications. While operational savings and long-term durability can offset these expenses, the higher initial investment can still be a significant barrier, particularly in price-sensitive markets.

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The Tankless Water Heater Market is segmented into technology, energy source, end use, sales channel and region.

Based on this sales channel, the online distribution channel is the fastest-growing segment in the global tankless water heater market, driven by rising e-commerce adoption and the convenience of home delivery. Consumers increasingly prefer online platforms for their wide product selection, competitive pricing, and easy comparison of features and reviews. E-commerce retailers often provide detailed product descriptions, installation guidance, and promotional discounts, making the purchase process more accessible. Additionally, growing internet penetration and secure digital payment options are boosting consumer confidence in online transactions. The ability to shop anytime, combined with frequent sales events, is accelerating the shift toward online purchases for tankless water heaters

Based on region, the Asia Pacific region is the fastest-growing market for tankless water heaters, driven by rapid urbanization, rising disposable incomes, and expanding middle-class populations. Increasing awareness of energy-efficient appliances and space-saving solutions is fueling adoption in densely populated cities. Government initiatives promoting sustainable energy use, coupled with infrastructure development, are further boosting demand. Technological advancements, competitive pricing by regional manufacturers, and the growing influence of e-commerce are making tankless water heaters more accessible to consumers. Additionally, lifestyle shifts toward modern, compact housing and the rising popularity of premium home appliances are accelerating market growth across key Asia Pacific countries

Major companies operating in the global Tankless Water Heater Market are:

• Ariston Holding N.V.
• A.O. Smith
• Bosch Thermotechnology Corp
• Bradford White Corporation
• GE Appliances
• Rheem Manufacturing Company
• Whirlpool Corporation
• Rinnai Corporation
• Ferroli S.p.A
• Havells India Limited

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“Technological advancements are further enhancing the value proposition of tankless water heaters. Many modern models are equipped with digital control systems, Wi-Fi connectivity, and smart home integration, allowing users to remotely adjust settings, monitor energy consumption, and receive maintenance alerts. Self-cleaning mechanisms, scale prevention technology, and corrosion-resistant materials are becoming standard features, improving system longevity and reducing maintenance needs. Additionally, innovations in heat exchanger design and condensing technology are boosting energy efficiency and reducing greenhouse gas emissions. These improvements not only enhance product performance but also align with stricter environmental regulations and the growing global shift toward sustainable living“, said Mr. Karan Chechi, Research Director of TechSci Research, a research-based management consulting firm.

“Tankless Water Heater Market – Global Industry Size, Share, Trends, Opportunity and Forecast, By Technology (Condensing, Non-Condensing), By Energy Source (Electric, Gas), By End Use (Condominium, Salon/Parlor, Hotels & Resort, Hospitals, Residential, Others), By Sales Channel (Hypermarkets/Supermarkets, Exclusive Stores, Multi-brand Stores, Online, Others), By Region & Competition, 2020-2030F”, has evaluated the future growth potential of global Tankless Water Heater Market and provides statistics & information on market size, structure and future market growth. The report intends to provide cutting-edge market intelligence and help decision makers take sound investment decisions. Besides, the report also identifies and analyzes the emerging trends along with essential drivers, challenges, and opportunities in the global Tankless Water Heater Market.

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