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July 19, 2021

Water Heater Prices "Heating Up" in 2021

We have consistently seen price increases set by manufacturers in the HVAC sector over the last several months. In some cases, a few manufactures have had to make multiple price increase announcements back to back, as the price of commodities & raw materials continues to rise through peak demand by all industries needing inputs. In addition, fuel costs have not seen a slow down in the last few months, which only adds to the increased costs of transportation, which according to some officials, is up 4x compared to logistics costs in the summer of 2020.

So far, no area of the blue collar trades has been left untouched, as materials costs for all jobs & projects has increased. The latest, and perhaps most volatile of price increases has landed on water heaters.

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Water Heater Manufacturer, A.O. Smith Raises Costs for the Fourth Time this Year

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A. O. Smith Corp. said it is boosting prices starting in August following higher material costs.

The company said in a securities filing that it is generally going to raise prices by the low double digits on a majority of its commercial and residential water heater products and services. This will affect parts of the U.S.

The company said the increases is due to higher material costs and specifically mentioned increasing transportation costs and the accelerating cost of steel.

The latest increase will put A.O. Smith costs at a 36% increase this year.

Water Heater Manufacturing Company, Rheem, Set To Increase Prices On Tank Water Heaters

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Fort Smith, AR – The water heater division of Rheem Sales Company, Inc. has announced price increases of 10-12% on Rheem Tank Water Heaters. The company has made several price increase announcements this year, including the air conditioning manufacturing arm of the company.

Bradford White Water Heaters Price Increases in 2021

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In a letter addressed to Bradford White customers, VP of Sales Matt Kozak has announced a price increase on the behalf of the company.

February 5, 2021
Subject: Bradford White Water Heaters Price Increase
Dear Valued Customer:
Since our last letter to you dated November 11, 2020, the global pandemic has continued to affect the
worldwide markets. At Bradford White, we have continued to absorb significant additional cost increases
in steel, freight, and other commodities used in the manufacture of water heaters.
After detailed analysis and careful consideration, we have come to the determination that we will be
implementing the following, additional price increase, effective with orders received at Bradford White
beginning March 29, 2021.
Product Category Approximate
Price Increase
Residential Products (Gas and Electric Tank Type) 9%
Commercial Products (Gas and Electric Tank Type) 7%
Commercial Storage Tanks 7%
Heat Pump Products 9%
Solar Products 9%
To qualify for current pricing, all orders must be received at Bradford White by March 26, 2021, and be
for shipment at our discretion.
The demand for water heaters is approaching an all time high due to impacts from the global pandemic.
Inventory imbalances, nesting, and an increase in new construction have all contributed to the rise in
demand. In an effort to ensure a consistent flow of product and minimize the impact on lead times during
the increase period, we will be limiting orders received on or before March 26, 2021 to your normal
monthly purchase volume, or as our production capacity will allow.
Thank you for your continued support. If you have any questions, please feel free to contact your Sales
Representative, your Regional Sales Manager, Director of Sales, or me.
Sincerely,
Matt Kozak
Vice President – Sales

 

Overall, these price increases add to the list of ever increasing products & commodities. Signs do not currently point to a slow down, and as such, future price increases may be expected.