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

U.S. HVAC Variable Refrigerant Flow Systems Market Size

U.S. HVAC Variable Refrigerant Flow Systems Market Trends and Growth Drivers

Growing Shift Toward Energy Efficiency and Sustainability Is a Key Trend

As consumers become aware about energy efficiency and regulations become stricter, VRF systems are becoming a popular choice to meet their needs because these systems are energy-efficient, they use compressors that adjust their speed and control refrigerant flow based on need, helping to reduce energy waste.

In January 2024, Toshiba carrier introduced a new heat recovery VRF system that can heat and cool different areas at the same time, helping to save energy in large commercial buildings like hotels and office buildings.

Rapid Urbanization Drives the Market

The U.S. market experiencing growth in cities and mixed-use developments. These buildings need HVAC systems that are flexible, and energy-efficient. As a result, VRF systems are becoming more common in multi-family homes. In urban areas with limited space for equipment, VRF systems are preferred because they take up less room and fit easily into smaller building designs, unlike traditional HVAC systems.

In September 2023, Johnson Controls-Hitachi Air Conditioning launched the Hitachi air365 Hybrid dual fuel system. This system combines the growth driver a heat pump and a furnace to keep homes comfortable all year round, while also cutting down on carbon emissions. The air365 Hybrid uses an electric Hitachi Mini VRF heat pump for heating and cooling and includes a special dual-fuel module that works with a new or existing gas furnace in the home.

High Initial Installation Costs are the Major Challenge

While VRF systems offer many benefits in terms of performance, energy efficiency, and reliability, many consumers, especially individuals and small commercial entities, are not willing to pay the high cost. Additionally, the easy availability of low-cost, less-advanced VRF systems adds pressure on manufacturers to keep prices competitive, while maintaining quality. Multiple local companies sell low-cost VRF systems with only the basic functionality and compliance to the minimum required standards, which are preferred by many customers.

U.S. HVAC Variable Refrigerant Flow Systems Market Analysis

Product Type Insight

• The heat pump VRF systems category held the larger market share, of around 60%, in 2024.
• This is because heat pump VRF systems provide both heating and cooling in a building by transferring refrigerant between indoor units and outdoor units based on the temperature demand. These systems are affordable to install and provide energy savings by adjusting refrigerant flow.
• The heat recovery VRF systems category will grow at a higher CAGR during the forecast period.
• This is because heat recovery VRF systems can heat and cool different areas of a building at the same time, which helps the system work more efficiently and saves energy. This makes them a popular choice for larger and more complex buildings.

The product types analyzed in this report are:

• Heat Pump VRF Systems (Larger Category)
• Heat Recovery VRF Systems (Faster-Growing Category)

Capacity Insight

• The small capacity (up to 10 tons) category held the largest market share in 2024.
• This is because small-capacity VRF systems offer an affordable and effective solution for heating and cooling in both commercial and residential buildings.
• These systems provide energy efficiency, space-saving, and flexible design.
• The medium capacity (10-50 tons) category will grow at the highest CAGR during the forecast period.
• This is because building codes and environmental rules are becoming stricter and consumers are adopting energy-efficient HVAC systems for mid-sized commercial buildings.
• These buildings require more robust, energy-efficient, and flexible HVAC systems than smaller buildings.

The capacity types analyzed in this report are:

• Small Capacity (Up to 10 tons) (Largest Category)
• Medium Capacity (10-50 tons) (Fastest-Growing Category)
• Large Capacity (Above 50 tons)

Application Insight

• The commercial category held the largest market share, of around 40%, in 2024.
• This is because the commercial sector is experiencing growth due to the rising number of offices, shopping malls, hospitals, educational institutions, hotels, and performance arenas.
• Essentially, the quick urbanization in the U.S. increases the demand for efficient HVAC systems in all such and other commercial properties.
• The residential category will grow at the highest CAGR during the forecast period.
• This is because nearly every resident in the U.S. has an HVAC system, which drives the demand for variable refrigerant flow. There is a growing trend in the U.S. of smart, energy-efficient homes, for which citizens are increasingly choosing advanced HVAC systems.
• Moreover, the burgeoning residential construction in the country drives the demand for variable refrigerant flow for HVAC units.

The application types analyzed in this report are:

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

Distribution Channel Insight

• The offline sales category held the larger market share, of around 75%, in 2024.
• This is because offline sales use traditional methods to sell VRF systems through direct sales teams, dealers, distributors, HVAC contractors, and retail stores.
• VRF systems need professional installation and setup, offline sales are more practical for many customers. This allows buyers to get the right support and expertise for their installation needs.
• The online sales category will grow at a higher CAGR during the forecast period.
• This is because online sales refer to the purchasing of VRF systems through e-commerce platforms, manufacturer websites, or third-party online marketplaces. Customers prefer these platforms because they provide convenience, comfort, and comparison.

The distribution channels analyzed in this report are:

• Offline Sales (Larger Category)
• Online Sales (Faster-Growing Category)

U.S. HVAC Variable Refrigerant Flow Systems Market Geographical Outlook

The western region in the U.S. held the largest market share, of around 35%, in 2024. This is because the western region of the U.S. experiences a variable climate, with much of it rather dry and the mountainous Pacific Coast significantly humid. This propels the demand for variable refrigerant flow, depending on the exact location within the west.
The southern regional market in the U.S. will grow at the highest CAGR during the forecast period. This is because the southern region of the U.S. experiences hot and humid weather. Additionally, the rapid growth in population and real estate market increases the sale of variable refrigerants due to high cooling demand.

The regions analyzed in this report are:

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

U.S. HVAC Variable Refrigerant Flow Systems Market Share

The U.S. HVAC variable refrigerant flow systems market is fragmented because there are many manufacturers providing VRF systems in different sizes, designs, and features to suit different needs and climates. They also provide products in different prices from affordable range to high-end, powerful models.

Additionally, as consumers become aware of the energy efficiency, many new players have entered the market to develop advanced VRF systems.

U.S. HVAC Variable Refrigerant Flow Systems Market News

• In September 2024, Fujitsu launched the latest version of its J-series heat pump mini VRF system with lower GWP-R32 refrigerant, which offers better efficiency.
• In May 2024, Lennox and Samsung signed an agreement to form a joint venture to sell ductless AC, heat pumps, and variable refrigerant flow products in the United States and Canada.