VRF System Market Report By Insights, Size, and Growth - 2031

The VRF System Market was valued at approximately US$ 21.65 billion in 2023 and is projected to grow to around US$ 54.09 billion by 2031. This market is anticipated to experience a compound annual growth rate (CAGR) of 12.1% from 2023 through 2031.

In Europe, the VRF system market is divided into several key regions, including Germany, Russia, France, the UK, Italy, and other parts of Europe. The growth of this market in Europe is primarily fueled by an increase in residential construction projects and stricter government regulations aimed at enhancing energy efficiency. Countries like Germany, the UK, and France have implemented policies that emphasize energy efficiency and the adoption of eco-friendly refrigerants, which are expected to boost the demand for VRF systems. Notably, in July 2022, the European Commission revised the F-Gas Regulation to enforce stringent guidelines on refrigerant usage. The commonly used HFC refrigerant in VRF systems, R410A, is being gradually replaced by HFC-32, which offers several advantages in minimizing the environmental impact of air conditioning. HFC-32 is recognized for not depleting the ozone layer.

The Smart Buildings Alliance (SBA) in France comprises 170 member organizations from diverse sectors within the building industry, including industrial firms, builders, developers, service providers, design firms, architects, and innovative startups. Numerous initiatives are underway to foster sustainable building practices across Europe. A significant number of European companies have pledged to achieve net-zero CO2 emissions in their buildings through the implementation of VRF systems. Major stakeholders in the construction sector, such as Deerns, BuroHappold, Grimshaw Architects, and Carbon Credentials, have joined cities like Helsinki and Valladolid in endorsing the World Green Building Council's Net Zero Carbon Buildings Commitment. Additionally, in December 2023, the European Commission formalized an agreement aimed at reducing emissions and energy consumption in buildings throughout the region. The goal is to lower the average primary energy consumption of residential buildings by 16% by 2030 and by 20-22% by 2035. These initiatives are significantly contributing to the positive trajectory of the VRF system market in Europe.

The market is categorized by system type into heat pump, heat recovery, and cooling-only systems. The heat pump segment dominated the VRF system market in 2023. Heat pump VRF systems are the most prevalent type, capable of either heating or cooling a building, but not both simultaneously. In heating mode, these systems extract heat from the outside air and transfer it indoors using refrigerant. Conversely, in cooling mode, they remove heat from the indoor air and expel it outside. These systems are particularly suitable for environments where either heating or cooling is required at different times throughout the building. They are commonly utilized in office buildings, retail spaces, and residential properties where consistent temperature control is necessary across various areas. Heat pump systems are known for their energy efficiency, thanks to the variable-speed compressor that adjusts refrigerant flow according to demand. Furthermore, they are easier to install and maintain compared to more intricate VRF systems.

Key players in the VRF System Market include FUJITSU GENERAL, Daikin Industries Ltd, Johnson Controls International Plc, Carrier Global Corp., LG Electronics Inc., Panasonic Holdings Corp., Samsung Electronics Co Ltd., Mitsubishi Electric Corp., Midea Group Co Ltd., Lennox International Inc., Blue Star Ltd., Yanmar Holdings Co Ltd., Trane Technologies Plc, Systemair AB, Voltas Ltd., and Robert Bosch GmbH. The market report also examines several other significant companies to provide a comprehensive overview of the VRF System Market and its ecosystem.

The overall market share for VRF systems has been determined through a combination of primary and secondary research methods. Extensive secondary research has been conducted utilizing both internal and external sources to gather qualitative and quantitative data related to the VRF System Market. This approach aids in forming a comprehensive overview and forecast of the market across all segments. Additionally, numerous primary interviews have been carried out with industry stakeholders to validate the findings and obtain analytical insights. This process includes discussions with industry experts such as vice presidents, business development managers, market intelligence managers, and national sales managers, as well as external consultants like valuation experts, research analysts, and key opinion leaders specializing in the VRF System Market.