Thermal Systems Market Report 2026

Thermal Systems Market Overview

• Thermal Systems market size has reached to $50.61 billion in 2025 • Expected to grow to $62.51 billion in 2030 at a compound annual growth rate (CAGR) of 4.3% • Growth Driver: Thermal Systems Market To Experience Growth Fueled By Electric Vehicle Boom • Market Trend: Adoption Of Natural Refrigerant-Based Air-To-Water Heat Pumps Accelerates Carbon-Neutral Heating Solutions • North America was the largest region in 2025.

What Is Covered Under Thermal Systems Market?

A thermal system is a multipart assembly of connected components, some of which are thermal, that interact to produce cold internally while exhibiting a shared organized behavior. Thermal systems are designed to manage heat generation, transfer, and dissipation in various processes or applications. The main components of the thermal system are an air filter, condenser, compressor, water pump, motor, heat exchanger, heater control, thermoelectric generator, and others which are used in various vehicles such as ICE, electric, off-vehicle, and ATV. Air filters are devices used to filter out airborne contaminants and pollutants that are bad for the environment and human health. The various vehicles involved are ice, electric, off-vehicle, and ATV. The various applications involved are front and rear A or C, powertrain, seat, steering, battery, motor, power electronics, waste heat recovery, and sensor.

What Is The Thermal Systems Market Growth Forecast?

The thermal systems market size is expected to see steady growth in the next few years. It will grow to $62.51 billion in 2030 at a compound annual growth rate (CAGR) of 4.3%. The growth in the forecast period can be attributed to increasing deployment of thermal systems in evs, rising need for battery and power electronics cooling, growth in automated industrial thermal regulation, expansion of high-efficiency thermal components, increasing demand for waste heat recovery solutions. Major trends in the forecast period include advancement of intelligent thermal management solutions, integration of IoT-enabled thermal monitoring systems, expansion of electric vehicle thermal regulation technologies, development of AI-based heat optimization platforms, adoption of sustainable energy-efficient thermal components.

Global Thermal Systems Market Segmentation

1) By Component: Air Filter, Condenser, Compressor, Water Pump, Motor, Heat Exchanger, Heater Control, Thermoelectric Generator, Other Components 2) By Vehicle: Internal Combustion Engines (ICE), Electric, Off-Vehicle And ATV 3) By Application: Front And Rear A Or C, Powertrain, Seat, Steering, Battery, Motor, Power Electronics, Waste Heat Recovery, Sensor Subsegments: 1) By Air Filter: HEPA Filters, Electrostatic Filters, Activated Carbon Filters 2) By Condenser: Air-Cooled Condensers, Water-Cooled Condensers, Shell And Tube Condensers 3) By Compressor: Reciprocating Compressors, Rotary Compressors, Scroll Compressors 4) By Water Pump: Centrifugal Pumps, Positive Displacement Pumps, Submersible Pumps 5) By Motor: AC Motors, DC Motors, Servo Motors 6) By Heat Exchanger: Shell And Tube Heat Exchangers, Plate Heat Exchangers, Air-Cooled Heat Exchangers 7) By Heater Control: Thermostats, Control Valves, Electronic Controllers 8) By Thermoelectric Generator: Module-Based Generators, System-Based Generators 9) By Other Components: Expansion Valves, Sensors And Thermocouples, Ducts And Fittings

What Is The Driver Of The Thermal Systems Market?

The growing demand for electric vehicles is expected to drive the expansion of the thermal systems market in the coming years. Known as battery electric vehicles (BEVs), these vehicles operate using an electric motor instead of an internal combustion engine. Thermal systems play a crucial role in maintaining optimal temperatures in battery packs, power electronics drives, and electric motors, while also managing both external and internal temperatures in electric vehicles. For instance, in December 2024, according to the U.S. Energy Information Administration (EIA), a US-based federal statistical agency under the Department of Energy, it was reported that the share of electric and hybrid vehicle sales in the United States reached a record high in the third quarter of 2024. Combined sales of hybrid, plug-in hybrid electric, and battery electric vehicles accounted for 21.2% of total new light-duty vehicle sales, up from 19.1% in the previous quarter. The growth was primarily driven by battery electric vehicles, which increased their market share from 7.4% to 8.9%, while hybrid vehicles also reached a record 10.6% share of total sales. Therefore, the rising demand for electric vehicles is driving the growth of the thermal systems industry.

Key Players In The Global Thermal Systems Market

Major companies operating in the thermal systems market are Continental AG, Denso Corporation, Dana Incorporated, Grayson Thermal Systems, Gentherm Inc., Hanon Systems, Lennox International Inc., Modine Manufacturing Company Inc., MAHLE GmbH, Robert Bosch GmbH, Valeo SA, Visteon Corporation, Schaeffler Technologies AG & Co. KG, Johnson Electric Holding Ltd., Sanden Corp., Diakin Industries Ltd., Calsonic Kansei Corp., BorgWarner Inc., ZF Friedrichshafen AG, Honeywell International Inc., Parker Hannifin Corporation, Siemens AG, Aavid Thermalloy LLC, Advanced Cooling Technologies Inc., Boyd Corporation, Delta Electronics Inc., Laird Technologies Inc., Lytron Inc., Nortek Air Solutions LLC, Thermacore Inc., Thermotek Inc., Vertiv Co., Wakefield-Vette Inc.

Global Thermal Systems Market Trends and Insights

Major companies operating in the thermal systems market are focusing on advanced innovations such as air-to-water (ATW) heat pumps utilizing natural refrigerants to improve energy efficiency, reduce carbon emissions, ensure regulatory compliance, and support global decarbonization goals. Air-to-water heat pumps using natural refrigerants, such as R290 (propane), extract heat from the air to provide heating, cooling, and domestic hot water while minimizing environmental impact. For instance, in October 2025, Mitsubishi Heavy Industries Thermal Systems, Ltd., a Japan-based manufacturer of HVAC and refrigeration solutions, launched two new models of its “Hydrolution EZY” series of air-to-water heat pumps for the European market that use R290 refrigerant. These new units feature high-temperature water heating capabilities, operate quietly, and are easy to install, aligning with Europe’s stricter environmental regulations and contributing to carbon neutrality under MHI Group’s MISSION NET ZERO initiative.

What Are Latest Mergers And Acquisitions In The Thermal Systems Market?

In August 2023, Mission Critical Group, a US-based provider of electrical equipment solutions, acquired Johnson Thermal Systems for an undisclosed amount. Through the acquisition, JTS is expected to continue to provide its suite of integrated design and manufacturing solutions. The acquisition also gives JTS access to the complementary system design and application engineering, manufacturing, on-site professional services, and ongoing support capabilities of the broader MCG platform. Johnson Thermal Systems is a US-based provider of thermal solutions.

Regional Outlook

North America was the largest region in the thermal systems market in 2025. The regions covered in this market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in this market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

What Defines the Thermal Systems Market?

The thermal systems market includes revenues earned by entities by EGR valve, A/C valve, oxygen sensor, temperature sensor, and charge air cooler. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

How is Market Value Defined and Measured?

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.

What Key Data and Analysis Are Included in the Thermal Systems Market Report 2026?

The thermal systems market research report is one of a series of new reports from The Business Research Company that provides market statistics, including industry global market size, regional shares, competitors with the market share, detailed market segments, market trends and opportunities, and any further data you may need to thrive in the thermal systems industry. The market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future state of the industry.