NORTH AMERICA VARIABLE FREQUENCY DRIVE MARKET ANALYSIS

A variable frequency drive (VFD) or also referred to as adjustable-frequency drive (AFD) is a type of adjustable-speed drive used in electro-mechanical drive systems to control AC motor speed and torque with the help of motor input frequency and voltage. Drives include various types of variable-speed drives used in different end-users industries such as shipping, manufacturing, and mining industries. Among drives, variable frequency drives find major application in commercial HVAC and manufacturing industries. An AC drive is a device that is used to control the speed of an electrical motor. Speed is controlled by changing frequency of electrical supply to the motor.

North America variable frequency drive (VFD) market is estimated to be valued at US$ 5,636.1 million in 2021 and is expected to exhibit a CAGR of 5.6 % over the forecast period (2021-2028).

Recent Developments:

In June 2021, Eaton Corporation, launched of the PowerXL DM1 micro variable frequency drive, designed for commercial, industrial and original equipment manufacturer (OEM) customers

In June 2021, Yaskawa Electric Corporation announced HV600 family of drives employs the latest advancements in variable speed control for HVAC applications

Statistics:

Figure 1. North America Variable Frequency Drive (VFD) Market Value (US$ Mn), by Country, 2020

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U.S. held dominant position in North America variable frequency drive (VFD) market in 2020, accounting for 78.6% share in terms of value, followed by Canada respectively. The growth can be attributed to various factors such as growing regulations towards energy efficiency, up gradation & modernization of aging infrastructure for safe & secure electrical distribution systems,  and increasing rate of industrialization and urbanization in the country.

North America Variable Frequency Drive (VFD) Market: Drivers

Rising energy efficiency is expected to drive growth of North America variable frequency drive (VFD) market during the forecast period

Rising energy prices have led to need for energy-efficient motor control system. It offers an alternative to throttling devices such as dampers and valves and fixed speed controllers. Thus, these factors are expected to drive growth of the North America variable frequency drive (VFD) market in the near future. For instance, in May 2015, Len Busch Roses deployed Danfoss’s variable frequency drive to regulate airflow in its snapdragon greenhouse with better precision. This helped Len Busch to reduce its energy costs by 22%.

Higher productivity efficiency is expected to propel the North America variable frequency drive (VFD) market growth over the forecast period

Operating VFD controlled motors at efficient speed results in less maintenance and downtime of motors. Furthermore, the lifespan of process equipment such as compressors, conveyors, and fans is augmented as VFD-enabled motors protect this equipment from issues such as under-voltage, overvoltage, and electro-thermal overloads. As a result of this, production levels increase thereby boosting the demand for VFDs. Hence, these factors are expected to boost the North America variable frequency drive (VFD) market growth over the forecast period.

North America Variable Frequency Drive (VFD) Market: Opportunities

Increasing adoption of smart grid technology can present lucrative opportunities

Smart grid technology is expected to offer significant business opportunities for VFD manufacturers. This is owing to emerging application of VFDs in smart grids to vary the phase angle and voltage required. This also ensures a more efficient transmission of electricity. Major companies in the market can capitalize on these opportunities and gain competitive edge in the market.

Innovation of industry-specific products can provide major opportunities in the near future

Major companies in the market are focused on product launches, in order to cater to specific industry needs and gain a competitive edge in the market. For instance, In February 2017, Toshiba International Corporation launched Toshiba T300MV2 drive, which is a medium voltage and adjustable speed drive (ASD). This adjustable speed drive is deployed in industries such as oil & gas, refinery, water/wastewater, power generation, mining & minerals, and other commercial industries. LGX Oil+Gas Inc., which is an oil & gas company, is using Toshiba T300MV2 drive.

Market Trends

One package solution

Major market players are involved in launching bundled solutions, in order to minimize customer buying efforts and thus enhance customer experience. For instance, Key players such as ABB, Siemens, and Rockwell Automation are offering combined motor-drive packages designed as per intended application. By offering a one-stop solution, players seek to enhance customer experience and generate higher revenues.

One drive for multiple motors

Many end-use industries are increasingly moving towards single VFDs for controlling multiple electric motors, in order to minimize energy consumption. This synchronous bypass method uses one VFD to start and synchronize multiple motors by transferring load from one source to another. Such installations optimize the process as well as provide substantial cost benefits to end users by minimizing both installation and operation costs. According to Rockwell Automation, asynchronous variable frequency drive system for controlling two motors can save up to 33% of initial capital spending.

Figure 2. North America Variable Frequency Drive (VFD) Market Share, By Drive Type, 2020

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Key Takeaways of the Graph:

• The AC Drive segment held dominant position in the market and accounted for 71.8% share in the North America Variable Frequency Drive (VFD) Market in 2020. The segment is expected to reach US$ 5,890.7 million in 2028. The widespread application of AC drives in medium and heavy industries, such as power generation, oil and gas, food and beverages, infrastructure, pulp and paper, and automotive is expected to boost the segment growth over the forecast period.
• The low voltage segment accounted for the largest share of 81.7% in the North America Variable Frequency Drive (VFD) Market and is expected to reach US$ 6681.1 million by 2028. This is attributed to increasing demand of low power variable frequency drives are mostly used for applications such as pumps, fans, crane, machine tools, fluid machines, metal processing machines, printing machines, and food processing machines.

North America Variable Frequency Drive (VFD) Market: Restraints

Technical difficulties related to VFDs are expected to restrain growth of the North America variable frequency drive (VFD) market during the forecast period

The majority of VFDs release a series of pulses that are rampantly switched. In applications where there is a long cable between the VFDs and the motor, these reflected pulses can lead to voltage production that exceeds line voltage, causing stress in motor windings and the cable. This, in turn, results in insulation failure, especially for motors operating at 480 volts or higher. Furthermore, selecting VFD for a given motor for typical application is a daunting task. If details go unnoticed during installation, performance of VFDs can substantially hinder productivity of process systems. Thus, these factors are expected to restrain growth of the market in the near future.

High initial cost of medium voltage VFDs are expected to hamper the North America variable frequency drive (VFD)

Prices of VFDs have declined significantly over the last decade, however, medium voltage VFDs come with high price tag. For typical applications in the industrial sector, medium voltage VFDs deployment is expected to increase during the forecast period. Furthermore, end users are shifting towards low-cost products made in China to manage budget. Thus, these factors are expected to hinder the market growth during the forecast period.

North America Variable Frequency Drive (VFD) Market: Competitive Landscape

Key companies involved in the North America variable frequency drive (VFD) market are Fuji Electric Co., Ltd, Schneider Electric, Mitsubishi Electric Corporation, Toshiba International Corporation, Siemens AG, Emerson Industrial Automation, ABB Ltd., Johnson Controls Inc., American Electric Technologies Inc. (AETI), Rockwell Automation Inc., General Electric Company, Honeywell International Inc., and Hitachi Limited.

Key Developments

Major companies in the market are focused on product launches, in order to expand product portfolio. For instance, in February 2017, Fuji Electric Co. launched FRENIC-Ace, a full-featured, versatile drive.

Key players in the market are involved in product development, in order to gain a competitive edge in the market. For instance, in February 2019, Mitsubishi Electric Automation, Inc., a subsidiary of, Mitsubishi Electric Corporation, launched FRA800-R2R Series of Variable Frequency Drives (VFD).