Exhaust Heat Recovery System Market Size, Share, Growth Analysis, By Technology, By Mode (Exhaust Gas Recirculation, Turbocharger), By Vehicle Type, By Component, By Application, By Region - Industry Forecast 2025-2032

Global Exhaust Heat Recovery System Market size was valued at USD 17.1 billion in 2023 and is poised to grow from USD 18.21 billion in 2024 to USD 30.14 billion by 2032, growing at a CAGR of 6.5% during the forecast period (2025-2032).

The exhaust heat recovery system market is poised for growth, driven by the rising demand for improved engine performance and fuel efficiency, alongside the trend of reducing engine sizes to lower vehicle weight. This technology captures wasted energy from exhaust gases to enhance engine efficiency and decrease greenhouse gas emissions. Key components such as turbochargers and exhaust gas recirculation systems have a significant presence in diesel and gasoline vehicles. However, the growing popularity of battery electric vehicles and challenges associated with exhaust heat recovery systems may hinder market expansion. Nevertheless, opportunities abound in developing economies with high turbocharger demand and increasing automobile production, positioning the global exhaust heat recovery system market for potential advancement in the coming years.

Top-down and bottom-up approaches were used to estimate and validate the size of the Global Exhaust Heat Recovery System market and to estimate the size of various other dependent submarkets. The research methodology used to estimate the market size includes the following details: The key players in the market were identified through secondary research, and their market shares in the respective regions were determined through primary and secondary research. This entire procedure includes the study of the annual and financial reports of the top market players and extensive interviews for key insights from industry leaders such as CEOs, VPs, directors, and marketing executives. All percentage shares split, and breakdowns were determined using secondary sources and verified through Primary sources. All possible parameters that affect the markets covered in this research study have been accounted for, viewed in extensive detail, verified through primary research, and analyzed to get the final quantitative and qualitative data.

Global Exhaust Heat Recovery System Market Segmental Analysis

Global Exhaust Heat Recovery System Market is segmented by Technology, Mode, Vehicle Type, Component, Application and Region. Based on Technology, the market is segmented into Conventional and Future Technology. Based on Mode, the market is segmented into Exhaust Gas Recirculation (EGR), Turbocharger, Organic Rankine Cycle and Thermoelectric Generator. Based on Vehicle Type, the market is segmented into Passenger Cars, Light Commercial Vehicles, Trucks and Buses. Based on Component, the market is segmented into EGR Component, Turbocharger Component, Organic Rankine Cycle Component and Thermoelectric Generator Component. Based on Application, the market is segmented into Automotive, Industrial, Residential and Commercial Sectors. Based on Region, the market is segmented into North America, Europe, Asia Pacific, Latin America and Middle East & Africa.

Driver of the Global Exhaust Heat Recovery System Market

The Global Exhaust Heat Recovery System market is propelled by the increasing demand for enhanced engine performance and fuel efficiency, driven by stringent government regulations aimed at reducing vehicle emissions and pollution. For instance, the European Union has set ambitious targets, mandating that fleet manufacturers achieve an average fuel efficiency of 57 miles per gallon by 2021 and 92 miles per gallon by 2030. These regulations urge automakers to innovate and develop more efficient engines that not only comply with these standards but also deliver superior performance. Technologies such as turbochargers and exhaust gas recirculation systems (EGR) are becoming essential, as they allow for the optimization of fuel consumption in smaller, turbo-boosted engines while aligning with Euro VI emissions standards.

Restraints in the Global Exhaust Heat Recovery System Market

The Global Exhaust Heat Recovery System market faces significant restraints due to stringent emissions regulations. In April 2023, the Environmental Protection Agency (EPA) introduced new standards designed to minimize harmful air pollution from both light and heavy-duty vehicles, with implementation set for 2027. This initiative follows established federal greenhouse gas emission standards for model years 2023 to 2026, emphasizing advancements in clean vehicle technology that benefit public health and lower the costs for consumers through enhanced fuel efficiency and reduced maintenance. Consequently, to comply with these regulations, automakers are likely to increasingly adopt exhaust heat recovery systems (EHRS), as this technology improves engine efficiency by recovering waste heat and lowering emissions.

Market Trends of the Global Exhaust Heat Recovery System Market

The Global Exhaust Heat Recovery System market is experiencing robust growth, driven primarily by stringent emissions regulations and an increasing focus on sustainability across various sectors. As the automotive industry faces mounting pressure to reduce its carbon footprint amid escalating concerns over climate change, innovative solutions like exhaust heat recovery systems are gaining traction. The World Health Organization highlights the transportation sector as a significant contributor to greenhouse gas emissions, prompting regulatory bodies, particularly in the EU, to enforce stricter emission standards. Consequently, manufacturers are investing in advanced technologies to enhance energy efficiency and compliance, positioning the market for substantial expansion in the coming years.