Marine VFD Market

[237 Pages Report] The Marine VFD market is expected to grow from an estimated USD 1.1 billion in 2023 to USD 1.6 billion by 2030, at a CAGR of 5.0% during the forecast period. The nations are undergoing rapid industrialization, there is a greater demand for power. The increasing demand for energy-efficient systems in maritime vessels to control and adjust the speed and power of electric motors for efficiency and precision. This is enhancing the investment in the development of Marine VFD.

To know about the assumptions considered for the study, Request for Free Sample Report

To know about the assumptions considered for the study, download the pdf brochure

Marine VFD market Dynamics

Driver: Increasing demand for energy-efficient systems in maritime vessels

The maritime industry is currently in the midst of a significant transformation, with a strong focus on enhancing energy efficiency. This transformation is being primarily motivated by a combination of economic factors, sustainability goals, and the implementation of strict regulations. In this evolving landscape, the marine Variable Frequency Drive (VFD) market is experiencing substantial growth and is poised for further expansion. Key drivers of this growth include international regulations and standards, such as the Energy Efficiency Existing Ship Index (EEXI) and the Carbon Intensity Indicator (CII) established by the International Maritime Organization (IMO). These regulatory requirements necessitate vessels to meet stringent energy efficiency criteria, compelling shipowners and operators to invest in advanced technologies to comply with these mandates.

Restraints: High Initial Investment

Despite its considerable potential, the marine Variable Frequency Drive (VFD) market is faced with a significant restraint in the form of substantial investments associated with both retrofitting existing ships and integrating VFDs into new vessels. These cost-related challenges are expected to impede the growth of the marine VFD market.

One of the primary hindrances to the widespread adoption of marine VFDs is the significant upfront investment that is necessary. Retrofitting ships with VFDs can incur substantial costs, including expenses related to the procurement of VFD equipment, labor required for installation, engineering modifications, and the integration of the system. Similarly, the inclusion of VFDs in the designs of new ships demands allocating a portion of the ship's construction budget to this technology. These elevated initial costs have the potential to deter shipowners and operators, especially during periods of financial constraints or when budgets are closely managed.

Opportunity: Growing adoption of electric and hybrid propulsion systems

The maritime industry is currently experiencing a fundamental shift towards the adoption of electric and hybrid propulsion systems for marine vessels. The adoption of electric and hybrid propulsion in marine vessels is expected to drive the demand for marine VFDs. This shift is primarily driven by a compelling set of advantages, encompassing economic, environmental, and operational benefits. Notably, recent advancements in battery technology have played a pivotal role in facilitating this transformation, promising more efficient energy utilization, cost savings in fuel consumption, reduced emissions, and enhanced safety. Within this evolving landscape, there is a growing prevalence of electric and hybrid ships equipped with large batteries and optimized power control systems. These vessels derive significant advantages from their reduced reliance on traditional fuel sources, resulting in substantial cost reductions and a remarkable decrease in emissions, spanning CO2, SOX, NOX, and particulate matter. A notable catalyst for this shift has been the remarkable drop in battery prices, which have decreased by approximately 60-70% over the past four years, rendering battery propulsion economically feasible and attractive for a wide range of marine applications.

Challenges: Supply chain disruptions due to shortage of components and parts

The disruption in the semiconductor supply chain has emerged as a formidable challenge for the widespread adoption of marine VFDs in the maritime sector. These VFDs, known for their energy efficiency and precise control capabilities, rely heavily on semiconductor components, and the disruption in the supply chain for these crucial components has significant implications for the adoption of this technology.

According to the Semiconductor Industry Association, the semiconductor shortage took hold in 2020 due to a confluence of factors impacting supply and demand caused by the COVID-19 pandemic. In some industries, customers canceled chip purchases due to disrupted production, while in other industries, demand increased rapidly due to remote working policies. Moreover, the semiconductor supply chain disruption has impacted the innovation and development of advanced VFD technologies. The integration of cutting-edge semiconductor components, such as microcontrollers and digital signal processors, is crucial for enhancing the performance and functionality of VFDs. However, as semiconductor manufacturers struggle to meet demand across various industries, the maritime sector faces challenges accessing these advanced components for next-generation VFDs.

Marine VFD  Market Ecosystem

Notable players in this industry comprise long-standing, financially robust manufacturers of Marine VFD Market and related components. These companies have a significant track record in the market, offering a wide range of products, employing cutting-edge technologies, and maintaining robust global sales and marketing networks. Prominent companies in this market include Siemens (Germany), ABB (Switzerland), Danfoss (Denmark), General Electric (US), and Rockwell Automation (US).

Fan, is expected to be the second largest market on based on application type

Marine VFDs are employed in fans on marine vessels for several reasons. They enable precise control over fan speed, allowing adjustments to match the varying ventilation requirements of different ship compartments and conditions. This fine-tuned control ensures optimal air circulation and contributes to energy efficiency by preventing unnecessary power consumption when full fan speed is not required. In addition to energy savings, VFDs in marine fans extend equipment lifespan by reducing wear and tear on fan components through soft starting and stopping. Moreover, they also play a pivotal role in maintaining air quality and comfort for crew members and passengers, crucial for overall safety and well-being during extended voyages at sea.

Low voltage, by voltage, to hold the largest market share during the forecast period during the forecast period

Low voltage is one of the dominant segments of the marine VFD market. Low voltage marine VFDs represent specialized control systems tailored for marine and offshore applications characterized by lower voltage levels, typically below 1,000 volts. These VFDs are vital components in smaller vessels like ferries, tugboats, and offshore support vessels, where the precise control and enhanced energy efficiency they offer are of utmost importance. The growing small vessel market, including offshore support vessels and ferries, is fueling demand for low-voltage VFDs.

Asia Pacific is expected to account for the fastest market during the forecast period.

Asia Pacific is a fastest market the Asia Pacific region emerged as a notably expanding market for marine Variable Frequency Drives (VFDs). This region has been subdivided into three key segments: China, Japan, and the Rest of Asia Pacific, which includes countries like India, Australia, and South Korea.

China's significant growth in the naval sector and its competitive advancements in propulsion technologies, including innovations like ammonia-fueled ships, underscore the nation's dedication to maritime progress and sustainability. VFDs play a crucial role in enhancing vessel efficiency within this context. Japan's commitment to maritime security, exemplified by the introduction of the "Rules for Construction and Classification of Indian Naval Ships 2023," along with its thriving marine economy, further drives the demand for VFD technology. Australia's strong environmental focus and the growth of its shipbuilding sector align with the adoption of VFDs as a means to improve energy efficiency and reduce emissions. In India, regulatory measures aimed at vessel modernization and the release of naval construction rules emphasize the significance of VFDs in enhancing naval capabilities and promoting sustainability. South Korea's ventures into eco-friendly marine biofuels and propulsion innovations also contribute to the promotion of VFD adoption in the region. Collectively, these factors underscore the pivotal role of VFD technology in advancing maritime efficiency, sustainability, and overall performance within the diverse and dynamic Asia Pacific maritime landscape.

Key Market Players

The Marine VFD  market is dominated by a few major players that have a wide regional presence. The major players in the Marine VFD  market are Siemens (Germany), ABB (Switzerland), Danfoss (Denmark), General Electric (US), and Rockwell Automation (US). Between 2019 and 2023, Strategies such as product launches, contracts, agreements, partnerships, collaborations, alliances, acquisitions, and expansions are followed by these companies to capture a larger share of the Marine VFD  market.

Want to explore hidden markets that can drive new revenue in Marine VFD Market?

Unlock Insights

Click on image to enlarge

Scope of the Report

This research report categorizes the marine VFD market by type, voltage, application, end user, and region

On the basis of type, the marine VFD market has been segmented as follows:

• New
• Retrofit

On the basis of voltage, the marine VFD market has been segmented as follows:

• Low Voltage
• Medium Voltage

On the basis of by application, the marine VFD market has been segmented as follows:

• Pump
• Propulsion
• Fan
• Compressor
• Crane & Hoist
• Winch
• HVAC
• Steering
• Scrubber
• Shaft Generator
• Power Electronics

On the basis of by end user, the marine VFD market has been segmented as follows:

• Marine ships
• Offshore platforms

On the basis of region, the marine VFD market has been segmented as follows:

• Asia Pacific
• Europe
• North America
• Middle East & Africa
• South America

Recent Developments

• In May 2023, GE Power Conversion signed an agreement to renew its partnership with Nedstack Fuel Cell Technology for the development of marine fuel cell solutions. The agreement follows on from a previous cooperation agreement for collaborative work. A pilot project for a large-scale marine fuel cell application provided valuable feasibility support to a cruise provider for their technical and commercial evaluation of decarbonization solutions.
• In June 2022, ABB leads a consortium to implement shore-to-ship power connections for ferries and cruise ships at the port of Toulon. ABB’s technology reduces emissions and noise during port stops. Additionally, ABB is installing an energy storage system to handle grid demand fluctuations and incorporate renewable energy sources, ensuring a sustainable and efficient solution.
• In December 2020, Cochin Shipyard selected Siemens to implement advanced marine solutions for India’s first fleet of 23 boats equipped with electric propulsion and battery-integrated technology.

Frequently Asked Questions (FAQ):

To speak to our analyst for a discussion on the above findings, click Speak to Analyst