Executive vice president and general manager
The demand for tankless water heaters is increasing as the HVACR industry and homeowners alike strive toward energy efficiency. According to ReportLinker, the tankless water heater market is projected to reach USD 6.8 billion by 2030, with a compound annual growth rate (CAGR) of 8.7% during the next seven years.
However, in today’s era of supply chain issues, demand isn’t necessarily met with supply, and manufacturers of tankless water heaters have to continue to work under abnormal conditions.
Jason Fleming, executive vice president and general manager of Nortiz, shared perspective with The ACHR NEWS into the industry outlook’s for tankless water heaters.
What is the outlook for the tankless market over the next two years?
JF: The tankless market went down for the first time in many years in 2022. Over the next few years, we will see a rebound and I anticipate growth. With all our logistical challenges, we are happy to get out there and sell again.
What sort of things are considered when evaluating the tankless water heater market?
JF: Many things go into the evaluation, such as the current condition of the home building and retrofit market, as well as general economic conditions, including the availability of labor and product.
What trends do you predict for the tankless water heater market over the next few years?
JF: Trends for tankless continue to be getting the best bang for the buck. Tankless offers so many versatile options for installation. The top-mount connections of our systems save over an hour of installation time and help reduce general installation costs, offering a big retrofit advantage … endless hot water and favorable warranties.
Which segment of tankless will be the most lucrative? Residential? Commercial?
JF: Commercial business is the most profitable, but it also takes the most long-term effort from specification to installation start-up, owner-management training, etc.
How do energy efficiency and electrification affect the tankless water heater market?
JF: These two areas greatly impact the market. Efficiency continues to increase, but we are nearing the peak of what we can do, so the main step is converting as many low-efficiency tanks to high-efficiency tankless. Electrification is a concern, but the systems are not set up to handle things at this point and we feel we have a better solution to heat water.
What impact has COVID-19 had on the tankless water heater market?
JF: Huge! Over the past few years, we have faced many abnormal market conditions. People working from home was great, as many decided to make upgrades, which helped. At the same time, COVID created logistical nightmares — from being able to produce product, ship product, and receive product. All areas of logistics have been strained. We are very happy to be back in stock and ready to move product.
What benefits of tankless water heaters can contractors use to sell them?
JF: I talked a bit about this above, but contractors should be pushing the basic three advantages — endless hot water, savings on utility bills, and longer product life with warranties of up to 25 years. This should be the last water heater you ever buy. I invite contractors to check out our podcasts about tankless topics, including one that specifically talks about selling tankless.
Any certain region of North America where you think tankless water heaters will really “take off”?
JF: The warm belt continues to be a strong area for tankless, but all markets are gaining knowledge and awareness of the product.
What are some key insights into the tankless water heater market?
JF:Energy Star continues to make changes. For more details, visit www.energystar.gov/products/water_heaters/residential_water_heaters_key_product_criteria.
2023 HVAC Predictions
What is in store for the HVAC industry in 2023? We talk with Frank Windsor, president of Rinnai, to fill us in.
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