Refrigeration Compressor Market

Market Definition

The market includes the production and sale of compressors used in cooling systems such as refrigerators, air conditioners, and cold storage units. These compressors are essential for refrigerant circulation and temperature control. 

The market serves residential, commercial, and industrial applications, with scope across food preservation, automotive, pharmaceuticals, and transportation cooling solutions. The report outlines the primary drivers of market growth, along with an in-depth analysis of emerging trends and evolving regulatory frameworks shaping the industry's growth trajectory.

Refrigeration Compressor Market Overview

The global refrigeration compressor market size was valued at USD 37.88 billion in 2024 and is projected to grow from USD 39.55 billion in 2025 to USD 54.31 billion by 2032, exhibiting a CAGR of 4.58% during the forecast period. 

This growth is fueled by the rising demand for cold storage and the expansion of the supply chain. Advancements focus on energy efficiency, low-GWP refrigerants, smart controls, and variable-speed operation, enabling flexible, sustainable systems that meet diverse temperature needs while reducing environmental impact.

Major companies operating in the refrigeration compressor industry are Danfoss, Nidec Motor Corporation, Emerson Electric Co, Mitsubishi Electric Corporation, Midea Group, LG Electronics, Panasonic Corporation, Kirloskar, Johnson Controls–Hitachi Air Conditioning, Carrier, GEA Group Aktiengesellschaft, FRASCOLD S.p.A, Ingersoll Rand, Dorin S.p.A., and Tecumseh Products Company LLC.

Market growth is propelled by rapid urbanization and rising air conditioner adoption across residential and commercial sectors. Growing urban populations and higher living standards are increasing demand for reliable cooling solutions. 

Enhanced local assembly, integrated production facilities, and planned capacity expansions are ensuring a stable compressor supply. Consequently, efficient and readily available compressors are pivotal to supporting the expanding HVAC infrastructure.

• In December 2024, Daikin's partnership with Rechi Precision to establish a joint venture in India aligns with the rapid urbanization and growing demand for air conditioning in both residential and commercial sectors. The joint venture will leverage Daikin’s market presence and Rechi’s compressor expertise, ensuring a stable supply of cost-effective, high-quality compressors to meet the increasing HVAC demand in the country.

Key Highlights:

1. The refrigeration compressor industry size was recorded at USD 37.88 billion in 2024.
2. The market is projected to grow at a CAGR of 4.58% from 2025 to 2032.
3. Asia Pacific held a market share of 33.85% in 2024, with a valuation of USD 12.82 billion.
4. The centrifugal segment garnered USD 15.96 billion in revenue in 2024.
5. The hermetic segment is expected to reach USD 20.91 billion by 2032.
6. The carbon dioxide segment is anticipated to witness a CAGR of 5.05% over the forecast period.
7. The food & beverages segment is estimated to account for a share of 28.11% by 2032.
8. Europe is anticipated to grow at a CAGR of 4.92% through the projection period.

Market Driver

 Increasing Need for Refrigerated Storage in Food Industry

The expansion of the refrigeration compressor market is propelled by the growing demand for cold storage and refrigerated transport in the food and beverage industry. As global supply chains expand and consumer demand for fresh and frozen products rises, efficient and reliable refrigeration solutions become critical. 

This highlights the need for compressors capable of handling diverse temperature requirements and ensuring product quality during storage and transit. Increasing focus on sustainability further promoted the adoption of advanced compressors with improved energy efficiency and reduced environmental impact.

• In March 2025, Frascold launched a new generation of semi-hermetic compressors designed to address market challenges and complex refrigeration and heating needs. Expanding beyond traditional refrigeration sectors such as food storage and data centers, the new series supports high-temperature operations up to 165°C. This enables applications in industrial and district heating, heat pumps, and sectors such as chemical, pharmaceutical, and food processing.

Market Challenge

Environmental Concerns Related to Refrigerant Emissions

The progress of the refrigeration compressor market is constrained by growing environmental concerns over refrigerant leaks and high global warming potential (GWP) of traditional hydrofluorocarbon gases. Regulatory pressures and end-user demand for low-emission systems are driving manufacturers to adopt natural refrigerants such as CO₂, ammonia, and hydrocarbons. 

Companies are redesigning compressors for compatibility, investing in advanced leak-detection technologies and hermetic sealing. R&D efforts focus on next‑generation low‑GWP refrigerant lubrication and durable materials. 

Industry collaboration also supports refrigerant recycling and reclamation programs, ensuring sustainable end‑of‑life management and regulatory compliance. Optimized compressor designs further enhance efficiency.

Market Trend

Technological Advancements in Compressors

The refrigeration compressor market is experiencing a notable trend toward continuous technological advancements aimed at enhancing energy efficiency, reducing environmental impact, and supporting the adoption of low-GWP refrigerants. 

Earlier efforts emphasized reliability and performance in diverse climate conditions. Recent innovations incorporate smart controls, variable-speed operation, and compatibility with eco-friendly refrigerants. These developments support more flexible system designs, contributing to the broader transition to sustainable and future-ready refrigeration solutions.

• In July 2024, Danfoss launched two compressors for low‑GWP refrigerants in North America: the PSH scroll for reversible rooftop systems in cold climates, and the BOCK HGX56 CO₂ T six‑cylinder semi‑hermetic reciprocating unit for large‑capacity heat pumps. These products, supported by Danfoss's proven portfolio, offer OEMs flexible system designs and a stable supply chain to support the green transition.

Refrigeration Compressor Market Report Snapshot

Segmentation	Details
By  Type	Centrifugal, Rotary, Reciprocating
By Drive	Hermetic, Semi-hermetic, Open
By  Refrigerant	Ammonia, Carbon Dioxide, Hydroflurocarbon (HFC), Hydrochlorofluorocarbons (HCFC), Others
By End-user Industry	Food & Beverages, Automotive, Chemical & Petrochemical, Pharmaceutical, Others
By Region	North America: U.S., Canada, Mexico
	Europe: France, UK, Spain, Germany, Italy, Russia, Rest of Europe
	Asia-Pacific: China, Japan, India, Australia, ASEAN, South Korea, Rest of Asia-Pacific
	Middle East & Africa: Turkey, U.A.E., Saudi Arabia, South Africa, Rest of Middle East & Africa
	South America: Brazil, Argentina, Rest of South America

Market Segmentation

• By Type (Centrifugal, Rotary, and Reciprocating): The centrifugal segment earned USD 15.96 billion in 2024 due to its superior energy efficiency, low maintenance requirements, and widespread adoption in large-scale industrial and HVAC applications.
• By Drive (Hermetic, Semi-hermetic, and Open): The hermetic segment held a share of 38.46% in 2024, fueled by its compact design, lower risk of refrigerant leakage, and cost-effective suitability for residential and light commercial refrigeration systems.
• By Refrigerant (Ammonia, Carbon Dioxide, Hydroflurocarbon (HFC), and Hydrochlorofluorocarbons (HCFC)): The ammonia segment is projected to reach USD 14.22 billion by 2032, propelled by its high thermodynamic efficiency, low environmental impact, and increasing regulatory support for natural refrigerants.
• By End-user Industry (Food & Beverages, Automotive, Chemical & Petrochemical, Pharmaceutical, and Others): The food & beverages segment held a share of 28.11 % in 2032 fostered by the rising global demand for cold chain logistics and stringent regulations on food safety and preservation.

Refrigeration Compressor Market Regional Analysis

Based on region, the market has been classified into North America, Europe, Asia Pacific, Middle East & Africa, and South America.

The Asia Pacific refrigeration compressor market share stood at around 33.85% in 2024, valued at USD 12.82 billion. This dominance is reinforced by strong domestic manufacturing capabilities, rapid urbanization, and rising demand for energy-efficient cooling systems. 

Government initiatives promoting local production and technological self-reliance are accelerating this development. High population density and increasing disposable income further boost the adoption of air conditioning and refrigeration across residential and commercial sectors, stimulating regional market expansion.

• In March 2023, LG Electronics India invested USD 12.05 million to launch a new manufacturing line for Dual Inverter Air Conditioner compressors at its Greater Noida facility. With an annual capacity exceeding 1 million units, this initiative boosts domestic production of advanced refrigeration compressors, advancing self-reliance and reinforcing LG’s leadership in India’s energy-efficient air conditioning industry.

The Europe refrigeration compressor industry is estimated to grow at a CAGR of 4.92% over the forecast period. This growth is bolstered by strict environmental regulations and strong decarbonization targets. The region’s push for low-GWP refrigerants and adoption of CO₂-based systems is accelerating the transition to sustainable cooling and heating technologies. 

Growing demand for energy-efficient solutions across industrial, commercial, and residential sectors, supported by policy incentives and technological innovation, positions Europe as the fastest-growing region in the market.

• In March 2023, Danfoss acquired BOCK GmbH, a manufacturer of CO₂ and low-GWP compressors. The acquisition is part of Danfoss' strategy to speed up decarbonization efforts by offering efficient, environmentally friendly cooling and heating solutions.

Regulatory Frameworks

• In the U.S., the Environmental Protection Agency (EPA) regulates refrigerants under the Clean Air Act and the American Innovation and Manufacturing (AIM) Act. These regulations restrict ozone-depleting substances (ODS) and hydrofluorocarbons, which must be handled exclusively by certified technicians.
• In India, the Bureau of Indian Standards (BIS) regulates refrigeration compressors through Quality Control Orders. Manufacturers must obtain a BIS license and comply with standards to use the Indian Standards Institute (ISI) mark, ensuring product quality and market compliance.
• In Europe, refrigeration compressors are regulated under the EU F-Gas Regulation (No 517/2014), which targets fluorinated greenhouse gases (F-gases) used in compressors. This regulation aims to reduce their usage due to their significant global warming potential and environmental impact.

Competitive Landscape

Key players in the refrigeration compressor industry are implementing several strategic initiatives, including mergers and acquisitions and launching new products, to gain a competitive edge. They are expanding their portfolios by introducing advanced compressor models that cater to evolving industry demands and regulatory requirements. 

Product launches focus on innovative technologies, enhanced performance, and sustainability features to capture broader market segments. These efforts highlight a dynamic market where businesses continuously invest in development and consolidation to address diverse customer needs.

• In April 2024, Frascold introduced the new TK HD series of transcritical CO2 compressors, emphasizing high performance and continuous reliability. With a focus on sustainability and innovation, this natural refrigerant solution offers superior energy efficiency, durability, and adaptability across varied workloads. It supports diverse applications, including refrigeration, cooling, and high-temperature heat pumps up to 100°C, reflecting the company’s commitment to environmental responsibility.

List of Key Companies in Refrigeration Compressor Market:

• Danfoss
• Nidec Motor Corporation
• Emerson Electric Co
• Mitsubishi Electric Corporation
• Midea Group
• LG Electronics
• Panasonic Corporation
• Kirloskar
• Johnson Controls–Hitachi Air Conditioning
• Carrier
• GEA Group Aktiengesellschaft
• FRASCOLD S.p.A
• Ingersoll Rand
• Dorin S.p.A.
• Tecumseh Products Company LLC

Recent Developments (M&A)

• In April 2025, ELGi Compressors USA showcased its industrial and portable compressed air solutions, including the EQ Series and D185T4F portable compressor, at the AICD conference. The company highlights reliability, energy efficiency, strong partner support, industry-leading warranties, and an expanded distributor network to enhance customer service.
• In December 2024, Mitsubishi Electric Europe B.V. acquired Crystal Air Holdings, enhancing its capacity to meet rising IT cooling demand in European data centers. The acquisition enables Mitsubishi Electric to offer integrated air-conditioning solutions, including sales, installation, and maintenance, while expanding energy-efficient air-conditioning and refrigeration systems that utilize low-GWP refrigerants globally.