U.S. HVAC Furnaces Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2025 - 2032)

U.S. HVAC Furnaces Market Size

U.S. HVAC Furnaces Market Trends and Growth Drivers

Sustainable, Smart, and Eco-Friendly Heating Solutions Are Key Trends

There is a growing trend of furnaces that use renewable energy sources, in response to the rising environmental concerns. Moreover, manufacturers are using sustainable and recyclable materials in furnaces to reduce the environmental the impact of raw material extraction and wastage. The government is also providing incentives and implementing policies to promote the adoption of low-emission and energy-efficient HVAC systems.

The integration of smart technologies in furnace is growing and is a reflection of the automation trend in the broader HVAC sector of the country. Smart furnaces, which can be controlled remotely via apps or integrated with home automation systems, offer consumers convenience, energy savings, and improved comfort. These systems are usually connected to home automation systems, which also control lighting, security, and entertainment appliances. This allows homeowners to manage all energy-consuming appliances in their homes from one easy-to-use platform.

Population Growth and Urbanization Growth Drive Market

The major drivers for the market are population growth and urbanization, especially in the Northeast and West regions. Three of the biggest metropolises in the country, namely New York City, San Francisco, and Los Angeles, are located in these two regions. Owing to their status as global financial hubs, they attract a huge number of people from overseas and other parts of the country on both temporary and permanent bases. The West and Northeast are also colder than other regions in the country, owing to the presence of mountains and a high latitude, respectively. The large number of office buildings, hotels, shopping malls, performance venues, and hospitals in the region boosts the demand for central heating systems, including furnaces.

Rising Energy Prices and Economic Uncertainty Are Key Challenges

The fluctuating cost of energy impacts consumers’ decision of investing in new furnaces negatively. High costs often cause homeowners to delay purchasing new HVAC systems or replacing their furnaces, as they prioritize essential expenses. Depending on usage and energy efficiency, electric furnaces can consume up to 26 kWh of energy a day, or 182 kWh per week. Moreover, furnaces fueled by fossil fuels, including propane and wood, are major emitters of GHG gases, which subjects users to compliance with the EPA’s regulations. Further, the rising competition from alternative heating technologies, such as geothermal systems and heat pumps, creates challenges for furnace manufacturers.

U.S. HVAC Furnaces Market Analysis

Furnace Type Insights

• The gas category holds the largest market share, of 55%, in 2024.
• This is because gas furnaces have lower operating costs and higher efficiency than others.
• Gas is one of the most-affordable and easily available heating fuels in colder regions, which makes gas furnaces an attractive option for consumers who need to operate them almost continuously.
• The electric category will grow at the highest CAGR during the forecast period.
• With the increasing electricity generation from renewable sources, electric furnaces become a more-sustainable option in areas where natural gas is not available.
• Electric furnaces are easier and cheaper to install as they do not require any venting or gas line.
• Moreover, they can be directly integrated with rooftop solar panels for higher sustainability and compliance with green building standards.

The furnace types analyzed in this report are:

• Gas (Largest Category)
• Oil
• Electric (Fastest-Growing Category)
• Others

Distribution Channel Insights

• The direct sales category holds the larger market share, of 60%, in 2024.
• This is because HVAC systems need to be installed by professionals with ample knowledge and expertise as the process is complex.
• Therefore, direct engagement with customers is required for contractors and manufacturers.
• HVAC contractors maintain strong relationships with manufacturers, ensuring that consumers get the best solution for their heating need.
• Online sales will grow at the highest CAGR during the forecast period.
• This is because nowadays, consumers prefer the convenience of researching, purchasing, and, sometimes, even scheduling installations online.
• The internet also allows customers to compare models, prices, and energy ratings, which makes their purchase easier and more comfortable.

The distribution channels analyzed in this report are:

• Direct Sales (Largest Category)
• Online Sales (Fastest-Growing Category)
• Others

Application Insights

• The replacement category holds the larger market share, of 45%, in 2024.
• This is because many homes and commercial buildings in the U.S. have old heating systems, which need to be replaced because they start consuming more fuel or electricity with time.
• The IECC addresses the performance of heating and cooling systems in buildings, including insulation, air sealing, and efficiency.
• As per studies, heating appliances use up to four times more energy than cooling appliances, which makes it imperative to replace the former at the end of their lives.
• The retrofit/upgrade category will grow at the highest CAGR during in the forecast period because of the increasing focus on energy efficiency due to environmental concerns.
• Retrofitting allows consumers to enhance their system’s performance without needing a complete replacement, which results in cost-effectiveness.

The applications analyzed in this report are:

• New Construction
• Replacement (Largest Category)
• Retrofit/Upgrade (Fastest-Growing Category)

End Use Insights

• The residential category holds the largest market share, of 40%, in 2024.
• This is because homeowners are increasingly adopting energy-efficient systems to reduce utility expenses.
• Residential heating systems are important everywhere in the U.S., except the South, due to the cool summers and long, harsh winters with temperatures regularly below freezing.
• The commercial category will grow at the highest CAGR during the forecast period.
• This is because strict energy codes and environmental regulations compel commercial entities to adopt more-efficient and eco-friendly heating solutions for visitor comfort.
• The Department of Energy (DoE) enforces standards for the Annual Fuel Utilization Efficiency (AFUE) of furnaces.
• The minimum AFUE for new gas furnaces is set at 80%, but many high-efficiency models now exceed 90% AFUE.
• The mountainous and northeastern regions of the country are quite popular with tourists, and hotels here generally have centralized heating systems.

The end uses analyzed in this report are:

• Residential (Largest Category)
• Commercial (Fastest-Growing Category)
• Industrial

Regional Analysis

The northeast region holds the largest market share, of around 35%, in 2024. This is because the northeast experiences cold weather, which increases the demand for reliable and efficient heating systems. Many aging buildings in this region are replacing or upgrading their furnaces with more-efficient models, to reduce energy expenses and their caron footprint.

The west region will grow at the highest CAGR during the forecast period. This is because the Western U.S. experiences a wide range of temperatures, from colder winters in mountainous areas and northern states (Washington, Oregon, Idaho, and California) to milder climates in coastal regions. This creates a demand for high-efficiency furnaces, especially in areas with colder winters, for several months of the year.

The regions analyzed in this report are:

• Northeast (Largest Category)
• Midwest
• West (Fastest-Growing Category)
• South

U.S. HVAC Furnaces Market Share

The U.S. HVAC furnaces Market is fragmented because a wide range of products, such as gas, electric, and oil models, are available via different distribution channels. The number of companies that offer these products is also rather high, which prevents any one from holding a significant share. Furnaces have been around for a long and, therefore, are not technically or financially challenging to manufacture.

U.S. HVAC Furnaces Market News

• In October 2024, Carrier Global Corporation rebranded its EcoEnergy Insights and CORTIX portfolios to Abound.
• In June 2024, Trane Technologies plc opened its new innovation center in Oberhausen, Germany. The center, covering 14,000 square meters, works on a variety of energy-efficient and sustainable heating and cooling systems for industrial and commercial buildings.