Transformer Market size was valued at USD 63.4 billion in 2024 and is projected to reach USD 172.4 billion by the end of 2037, rising at a CAGR of 8% during the forecast period, i.e., 2025-2037. In 2025, the industry size of transformer is assessed at USD 68.4 billion.
The global transformer market is expanding due to the growing demand for electrification and the development of renewable infrastructure, which influences the global economy. Advanced transformers are in high demand due to the increasing need for reliable energy systems. In April 2024, Hitachi Energy announced an investment of more than USD 1.5 billion in expanding transformer manufacturing capacity globally, thus becoming highly indicative of the trend for this industry to respond to growing demand. High investment at this level, in the wider energy transition ensures that transformer manufacturers are in a better position to meet this surging demand for sustainable power infrastructure. In addition, governments are also adopting supportive green energy policies, along with providing subsidies, thereby accelerating growth in the transformer market.
Furthermore, governments worldwide are actively developing policies that can help promote energy-efficient infrastructure, thus encouraging the adoption of eco-friendly transformers. Such initiatives help reduce carbon emissions and encourage the adoption of advanced technology-based transformers, including but not limited to IoT-enabled smart monitoring systems. As a result of these factors, budget allocations for energy infrastructure projects have gone up in major economies. This, along with funding in the sphere of smart grid projects, is expected to significantly increase demand for technologically advanced transformers during the forecast period.
Growth Drivers
Challenges
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Base Year |
2024 |
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Forecast Year |
2025-2037 |
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CAGR |
8% |
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Base Year Market Size (2024) |
USD 63.4 billion |
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Forecast Year Market Size (2037) |
USD 172.4 billion |
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Regional Scope |
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Core (Closed, Shell, Berry)
Shell segment is anticipated to dominate around 36.5% transformer market share by the end of 2037. Shell transformers are of sturdy build and are preferred for high-voltage applications hence, they find their fit in tough environmental conditions. In September 2022, Hitachi Energy introduced an oil-free shell transformer called RESIBLOC Rail for rail applications, which can support high-voltage requirements of up to 25 kV. As such, it is a development that evidences segment growth stirred by demand for durable and efficient transformers that can operate under rigorous conditions.
Product (Distribution Transformer, Power Transformer, Instrument Transformer)
By 2037, distribution transformer segment is projected to account for around 52% transformer market share, driven by the global expansion of urban and rural electrification projects. As cities grow and more rural areas continue to get access to electricity, the need for efficient and reliable distribution transformers is growing continuously. This underlines the rising adoption of distribution transformers that support city expansions and accessibility to energy. Furthermore, updating aged infrastructure boosts this segment’s growth, whereby governments and utilities give high priority to power distribution that is resilient and efficient. The segment growth is also driven by the increasing renewable energy projects since the need for a strong distribution network increases with the management and balance of variable power inputs.
Our in-depth analysis of the global market includes the following segments
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Core |
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Product |
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Winding |
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Cooling |
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Insulation |
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Rating |
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Mounting |
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Application |
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Asia Pacific Market Analysis
Asia Pacific transformer market is set to capture revenue share of over 35% by 2037, driven by rapid industrial expansion and investment in renewable energies. Infrastructure development and grid modernization have become prime priorities for governments across the region, acting as a catalyst for advanced transformer solutions. India and China are two lucrative countries in the market witnessing significant expansion prospects for manufacturers.
The transformer market is expanding due to the ambitious plans of the Government of India for strengthening energy grids, including recent rural electrification efforts. For example, the Power Grid Corporation of India proposed a collaboration for developing transmission lines in Kenya with Africa50 in January 2022, showcasing its expertise in large-scale transformer projects. This demonstrates the commitment of the country toward achieving a leading position in power infrastructure within the country and beyond by leveraging capabilities around transformer technology built up over time.
Growth in the transformer market in China is driven by a surge in investments in renewable energy coupled with the extension of high-voltage transmission systems. With China striving to enhance grid reliability and ensure better distribution of energy, advanced-class transformers are in high demand. Companies in China are actively investing in transformer manufacturing and development to meet these demands.
North America Market Analysis
North America transformers market is expected to register over 9% growth till 2037. The increasing integration of renewable energy and expanding data centers across the region promises a strong market for technically advanced transformer technologies. Government incentives and financial support are also uplifting the refurbishment of old power grids with high-efficiency transformers.
The U.S. transformer market also witnesses large-scale investments in green infrastructure and data centers, driving demand for high-efficiency transformers. In October 2021, Prolec Transformers expanded its U.S. operations with the acquisition of SPX Transformers, strengthening its position to serve this country's ever-growing demand for electrical infrastructure. This points to the acquisition as one of the important ways of market consolidation needed to meet ever-growing demands for power across data centers and renewable projects.
Government initiatives toward upgrading power infrastructure and achieving net-zero emissions are driving the transformer market in Canada. Renewable energy projects are also giving ample opportunities for environmentally friendly transformers. For example, in June 2023, ABB launched its latest eco-efficient power transformers in Canada that align with the country's sustainability objectives. This launch is a step toward meeting the country’s commitment to energy-efficient technologies, opening avenues for the growth of the segment.
The transformer market is highly competitive, with a number of key players such as ABB, Celme S.r.l., ERMCO, Elsewedy Electric, Hitec Products, Hitachi Energy Ltd., Hammond Power Solutions, HYOSUNG HEAVY INDUSTRIES, and Mitsubishi Electric Corporation. Companies are striving for innovative developments, strategic acquisitions, and increasing their production capacity owing to rising demand across the globe. The competitive landscape is shaped by the need to support renewable energy and promote strict regulatory standards. As a result, companies are taking the lead in eco-friendly technologies and smart transformer solutions.
Companies continue leveraging advanced materials and IoT integrations, hence driving the evolution of the transformer market further. In November 2023, Siemens announced it would invest USD 150 million in a high-tech manufacturing facility located in Texas. With this, Siemens is targeting the production of advanced transformers and electrical equipment for data centers and renewable projects. The facility indicates the competition in the market, where companies are making huge investments to scale up production and enhance their technological capabilities. The investment by Siemens underlines the importance of U.S.-based manufacturing to meet local demand, besides highlighting the trend for companies to expand their operations to support regional and global energy infrastructure requirements.
Here are some leading players in the transformer market:
Author Credits: Dhruv Bhatia
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