The heating market is currently in a paralyzing hold-up mode, and this is also affecting manufacturers. Several companies have already reacted with short-time work or job cuts due to a lack of orders. In 2025, sales fell to 627,000 heating units, the lowest level since 2010. Customers are deeply unsettled by the political maneuvering surrounding Habeck’s heating law and are postponing their investments until the government finally presents a revised bill. (welt: 01.02.26)
Heating Law – First Abolition Announced, Later Qualified, and No Reform Delivered by the End of January 2026
The government began by promising to abolish the “Heating Law.” Later, this remained only an announcement of a revision. For months, however, only a new label has been circulating, as the Building Energy Act is to be renamed the “Building Modernization Act.” Nevertheless, the promised key points were still missing by the end of January 2026, even though the coalition had set a deadline for precisely this.
For homeowners, this is a significant risk factor, as no one can reliably predict obligations, transitions, and the logic behind subsidies. Moreover, every vulnerability acts as a signal to inaction, because the next decision could change everything. The 65 percent requirement remains in effect, and at the same time, it remains unclear what a promised reform in 2026 will actually look like. Many households are thus lacking a clear political direction, as promises and timelines have so far yielded no results.
Sales figures for 2025: Gas plummets, oil collapses, heat pumps fall short of target
The figures show how profound the reluctance already is, across all technologies. Sales of gas condensing boilers fell to 229,000 units in 2025, a decrease of 36 percent compared to the previous year. Oil also collapsed, with only 22,500 oil heating systems sold to customers, representing a drop of 74 percent.
Sales of heat pumps grew to around 299,000 units in 2025, placing them at the top of the annual rankings. However, this remains far below the political target of 500,000 installations per year, which was previously considered necessary. Furthermore, it is estimated that only about a third of the units were installed in new buildings, while the conversion of existing buildings is slower.
Costs, regulations, and heating planning: Why buyers often decide to wait and see
Many customers are deterred not only by the price but also by the possibility that regulations could be tightened or subsidies revoked later on. Consumer protection agencies estimate the typical product and installation costs of a heat pump at around €36,000 on average, making any uncertainty more expensive. At the same time, municipal heating planning reinforces this wait-and-see approach, as property owners want to know whether district heating will be a realistic option for their street.
Added to this is the core conflict surrounding the 65 percent target, which the coalition is currently debating publicly. This creates a kind of “stop-and-go” situation in the heating market, causing even determined buyers to hesitate. The effect is politically self-inflicted, as the policy shifted from “abolish” to “revise” without ultimately reaching a definitive conclusion.
Job cuts become a location issue – if demand collapses, production migrates
The industry had built up capacity, but in many places, plants are no longer operating at full capacity. As a result, personnel measures are becoming increasingly common, and the sector is losing substance, even though restructuring in the building sector could secure jobs in the long term. The BDR Thermea example illustrates this dynamic particularly sharply: The company is ceasing production of heat generators in Rastede and Schweinfurt and relocating it to its “European manufacturing network.” According to company and media reports, around 203 full-time jobs are affected. BDR Thermea also cites “regulatory uncertainty” as a reason.
This means that the political maneuvering surrounding the heating law has direct consequences for locations, because investments without a demand base are wasted. At the same time, the pressure on suppliers and tradespeople is increasing, because fewer contracts mean less planning and less scope for training. As long as the government continues to fail to deliver a clear reform after the missed January deadline, the heating market remains in limbo.