The Variable Frequency Drive Market is projected to rise from USD 22.750 billion in 2025 to USD 29.313 billion in 2030, at a CAGR of 5.20%.
In segmentation of the variable frequency drive market by type, the market is segmented into AC, DC, and servo drives, among them AC drives are projected to have the largest market share in the forecast period as they can be used in a wide range of applications because of its adjustable characteristic which adjusts the power of the appliances according to the need. This in turn caters to the demand of the variable frequency drive in the forecasted period. Servo motors and drives growth is restrained by the limitations of these goods, such as the high cost which prevents investment in this market. Apart from it, the lack of skilled labor is the major constraint in the development and growth of the servo market. While under segmentation by power voltage, the market is segmented into low, medium, and high-voltage drives. The medium segment will have significant positive growth in the forecast period as it reduces energy consumption and carbon dioxide emissions into the environment, hence, further increasing the demand for medium voltage drives. The market by application is segmented into compressors, conveyors, pumps, fans, and others. Among them, the compressors have significant potential growth in the forecast period, because the demand for energy efficiency increases the demand for the variable frequency drives in compressors to reduce the electrical stress and prevent damage. The major industries that are using compressors are Oil & Gas, chemical, food & beverages, and building automation industries. The variable-frequency drive market is one of the major markets that work as an interconnection for the other markets, which are, the switchgear market, electric motor market, substation equipment market, control panel market, power quality equipment market, and HDVC Transmission market.
The market growth is driven by the increasing demand in various industries such as Oil & Gas, increasing government regulations for energy-effective consumption by reducing the wastage of power transmission, and increasing demand for energy efficiency. Stagnant market growth in the Oil & Gas Industry and fall in the production and research & development activities are adversely impacting the growth of the variable frequency drivers. This market has the potential growth in the research and development sector, which will bring innovative technology into the market, and that will be catered to by the government. This brings some new opportunities for the companies, such as power infrastructure up-gradation, improving the Internet of Things to improvise the application and people can use it remotely without facing any issues. Though, this opportunity brings a challenge for the companies to compete with the grey market suppliers which are supplying at competitive prices, hence, creating a hindrance for the potential companies.
The Asia Pacific is expected to have a substantial market share in the variable frequency drive market as this region is having an increasing population, which in turn, increases the demand for the consumption of power. Also, this region has rapid industrialization and urbanization, especially in China, India, South Korea, and Japan. That is why these countries are considered major manufacturers in the Asia Pacific region. Apart from it, the government is promoting the use of renewable sources of energy to protect the environment, which further boosts the demand for the variable frequency drive. There is potential growth for the companies to come up with innovative products to combine the recent energy generation with the current electrical infrastructure in an efficient way. There is potential growth in the transmission and distribution infrastructure sector of the Asia Pacific region due to the rapid industrialization and growth in renewable energy sources boosts the demand for effective energy consumption in the market. Though, this sector requires research & development, and innovation by the companies.
After the Asia Pacific region, North America is expected to hold the second-largest market share in the variable frequency market due to an increase in E&P activities, mainly for HVAC systems. While Europe has the potential growth in this market in building the infrastructure facilities and the Middle East and Africa market has the potential which is yet to be explored by the companies.
Variable Frequency Drive Market Segmentation: