Global inverter shipments are forecast to fall 2% in 2025 to 577 GW AC and another 9% in 2026 to 523 GW AC, after a record 589 GW AC in 2024
Wood Mackenzie sees China experiencing its first shipment decline since 2019 in 2025 due to policy uncertainty, yet it will remain the largest market long-term
Asia-Pacific ex-China will grow, led by India and Southeast Asia, while prices fall due to strong Chinese competition
Demand is expected to recover in the early 2030s, driven by electrification, AI-related power needs, repowering, and new inverter technologies
The global solar inverter market is expected to shrink for 2 years in a row, according to Wood Mackenzie’s latest 2025 outlook. Shipments in this segment are forecast to fall by 2% year-on-year (YoY) this year to 577 GW AC and by another 9% to 523 GW AC in 2026.
The decline follows record shipments of 589 GW AC in 2024 (see China Leads 589 GW AC Global PV Inverter Shipments In 2024). Wood Mackenzie links the decline to ongoing market uncertainty across major regions, including China, Europe, and the US.
The Chinese market will see a major decline this year, its first drop since 2019, to 304 GW AC in 2025, an annual loss of 5%. The analysts cite policy uncertainty for this decline, as the country transitions from the 14th to the 15th Five-Year Plan. Yet, it will maintain its dominance in this space with a cumulative inverter demand of more than 2.9 TW AC through 2034, adds Wood Mackenzie.
Asia Pacific excluding China (APeC) will grow to 89 GW AC in 2025 as domestic manufacturing takes off in India and Southeast Asia, along with the emergence of rooftop PV segments.
For the European market, persisting inventory challenges and reduced utility-scale capture prices in key markets like Spain will likely bring down the shipments to 83 GW AC in 2025 from 88 GW AC in 2024. Inverter shipments will continue to decline below 75 GW AC annually by 2032 in this part of the world.
The US, Wood Mackenzie projects, will be a 47 GW AC market this year before declining 22% in 2026 as tax credits under the Inflation Reduction Act (IRA) are phased out.
“After years of an exponential rise in solar inverter demand, continuous shipment growth is no longer realistic for even the top global inverter manufacturers,” said Wood Mackenzie Research Analyst Joe Shangraw. “Instead, vendors will need to adapt to new demand drivers to stay competitive: hybrid solar-plus-storage systems, retrofits and repowering, cybersecurity features, 2000-volt architectures, and grid services.”
Strong competition from Chinese manufacturers and ongoing technology improvements continue to put downward pressure on prices across all categories. Wood Mackenzie expects the steepest price decline for utility-scale inverters with Chinese domestic 3-phase string inverters to fall below $0.02/W AC, while central standalone inverters will approach $0.01/W AC by 2034.
Nevertheless, Shangraw sees the solar inverter market recovering and growing beyond 2024 levels by the early 2030s on the back of rising electrification, AI-driven power demand, and inverter replacements. Companies investing in new technologies now will be stronger when the market rebounds in the late 2020s.
Analysts also point to increasing cybersecurity concerns in both the US and Europe, as governments are expected to bring in stricter policies with regard to remote-access capabilities for inverters. Shangraw expects Europe to expand upon the Cyber Resilience Act, while the US may implement restrictions on Chinese inverter imports, adding uncertainty to the sector. This was also touched upon by RCT Solutions CEO Peter Fath during his presentation at the recent TaiyangNews Inverters & Battery Storage Conference (see Live Blog).
