In-Chassis Cooling Market By Cooling Technology (Air-Based Cooling, Liquid Cooling, Two-Phase Systems); By Application (Edge Computing, Telecom & 5G, Industrial Automation, Defense & Aerospace); By End User (Data Center Operators, OEMs/System Integrators, Defense Contractors, Industrial Equipment Providers); By Geography, Segment Revenue Estimation, Forecast, 2024–2030

1. Introduction and Strategic Context

The Global In-Chassis Cooling Market is projected to reach approximately USD 5.2 billion by 2030 , up from an estimated USD 2.9 billion in 2024 , growing at a CAGR of 9.7% between 2024 and 2030, according to Strategic Market Research.

 

At its core, in-chassis cooling is about managing rising heat loads within increasingly compact, high-performance computing systems — from servers and industrial controllers to edge AI devices and telecom gear. As chips get faster and form factors shrink, thermal performance isn’t a secondary concern — it’s a design constraint.

 

Between now and 2030, this market is shifting from passive, air-based systems to more advanced liquid cooling, cold plates, vapor chambers, and hybrid thermal loop designs — all inside the chassis. This reflects broader pressure across data centers, autonomous systems, and 5G infrastructure to balance high compute density with reliability, uptime, and energy efficiency.

The drivers go beyond heat. Liquid and hybrid in-chassis systems help reduce noise, enable smaller system footprints, and lower total power draw. With hyperscale players running hotter GPUs for AI workloads, and telco OEMs embedding edge compute in weatherproof boxes or base stations, cooling innovation is now critical infrastructure.

Regulatory forces are playing a role, too. Sustainability mandates in Europe, especially in Germany and the Nordics, are pushing manufacturers to report and reduce energy waste — and inefficient cooling is often the biggest culprit. Meanwhile, U.S. defense and aerospace agencies are demanding ruggedized thermal systems for battlefield compute nodes where failure isn’t an option.

Stakeholders in this market span OEMs, cooling system integrators, chipmakers, industrial PC builders, telecom and cloud operators, military contractors, and edge AI solution providers. And a new cohort of startups is building modular in-chassis thermal systems designed to retrofit legacy enclosures or integrate directly into new GPU-dense boards.

 

2. Market Segmentation and Forecast Scope

The in-chassis cooling market breaks down along four key axes — each shaped by how manufacturers approach thermal management based on hardware density, application criticality, and space constraints. Here’s how the segmentation typically unfolds:

By Cooling Technology

• Air-Based Cooling Still the most widely deployed solution, especially in entry-level and mid-performance systems. Think high-CFM axial fans, heat sinks, and ducted airflow strategies. But the limits are becoming clearer: higher decibel levels, reduced efficiency in dense environments, and diminishing returns as component TDPs increase.

• Liquid Cooling (Direct-to-Chip and Cold Plate ) Gaining traction in AI-heavy systems, military applications, and high-density edge compute. Liquid-based designs provide up to 10x higher thermal conductivity versus air and are essential when boards are stacked tight.

• Two-Phase Cooling (Vapor Chambers, Loop Heat Pipes ) Growing fast in telecom, aerospace, and rugged computing. Vapor chambers provide flat heat spreading in confined chassis, often replacing heat sinks. Loop heat pipes are now favored in sealed enclosures where forced airflow is impossible.

In 2024, air cooling still leads by deployment volume, but liquid and two-phase systems are the fastest-growing segments — expected to collectively surpass 50% of new deployments by 2028.

By Application

• Edge Computing Systems Use cases span from autonomous vehicle processors to remote surveillance nodes. These devices are often deployed in hostile or thermally constrained environments where in-chassis cooling must work without airflow support or human intervention.

• Telecom & 5G Infrastructure Macro base stations and microcells now host high-performance processing inside sealed chassis — often mounted on towers or poles. The thermal loads are steady but constant, and equipment has limited access for maintenance.

• Industrial Automation & Control PLCs, industrial PCs, and real-time control systems housed in factory enclosures are being pushed harder by machine vision and AI inference. Thermal management is becoming critical to uptime.

• Defense & Aerospace Platforms Military-grade computing systems require passive or vibration-resistant thermal systems that can survive shock, altitude changes, and extreme temperature swings — often inside compact, rugged enclosures.

Edge and telecom deployments are driving the fastest growth, especially where AI accelerators and real-time analytics are moving closer to the endpoint.

By End User

• Data Center Operators Especially those deploying micro data centers or edge pods. These users are now exploring in-chassis cold plates and sealed loop cooling for GPU-intensive racks.

• OEMs / System Integrators Companies that design and build industrial or telecom-grade compute systems are sourcing in-chassis cooling as part of integrated platforms — especially in high-volume builds.

• Defense Contractors Specifying thermal solutions for mission-critical computing in ground vehicles, drones, and naval systems — often under ITAR or MIL-STD requirements.

• Industrial Equipment Providers Including control cabinet builders and robot OEMs, integrating fanless or liquid-based solutions to reduce downtime in harsh environments.

By Region

• North America Dominated by hyperscalers , aerospace R&D, and a mature industrial automation base.

• Europe Strong push toward energy-efficient cooling and passive designs due to regulatory pressure.

• Asia Pacific Fastest-growing region — led by electronics manufacturing, telco rollouts, and urban infrastructure digitization.

• Latin America, Middle East & Africa (LAMEA ) Emerging deployments in smart city infrastructure and defense-led programs.

 

3. Market Trends and Innovation Landscape

The in-chassis cooling market is undergoing a quiet transformation. What's historically been a back-of-the-box consideration is now a front-line design challenge. As system performance, enclosure density, and deployment environments all get tougher, innovation is shifting from passive airflow to smart, adaptive cooling architectures. Here's what’s shaping the landscape:

Liquid Cooling Is Getting Smarter — and Smaller

Early liquid cooling systems were bulky and tailored for racks or external radiators. But that’s changing. Compact cold plates and microchannel-based solutions are now being integrated directly into server blades, edge boxes, and industrial controllers. The latest designs don’t just dissipate heat — they adapt in real-time.

Some OEMs are pairing embedded sensors with dynamic flow control valves, optimizing coolant distribution based on thermal hotspots. One U.S. defense integrator recently deployed such a system in a ruggedized GPU enclosure used for ISR drones — achieving a 20% reduction in thermal throttling during high-altitude missions.

The big shift? These systems aren’t DIY mods anymore. They’re productized, modular, and built for scale.

AI-Based Thermal Management Is Coming Inside the Box

Thermal simulation used to be done pre-build, often with CFD tools. Now, real-time thermal analytics are making their way into the chassis. Embedded ML models can adjust fan speeds, trigger cooling loop activation, or flag predictive maintenance events.

This is especially relevant in telecom and industrial automation, where remote equipment can’t fail — and where pre-failure thermal drift is now being monitored in real-time.

A startup in Germany is developing a plug-and-play thermal control module that sits between the system BIOS and fan controller — automatically tuning performance profiles based on environment and load.

Vapor Chambers and Loop Heat Pipes Are Going Vertical

2D heat spreaders were once flat — made for laptops or GPUs. But with vertical board configurations becoming more common in edge AI and embedded systems, loop heat pipe designs are being reimagined. Manufacturers are creating U-shaped and multi-axial pipes that route heat away from vertical boards and into shared passive fins.

One telecom OEM recently used such a system in its pole-mounted 5G node, enabling it to operate without fans in 42°C ambient outdoor temperatures — all in a sealed, waterproof chassis.

This kind of passive design is gaining momentum in Europe and Southeast Asia, where low-maintenance edge systems are critical.

Hybrid Cooling Systems Are on the Rise

Mixing air and liquid isn’t new — but now it’s happening inside the chassis. Some edge servers use closed-loop cold plates for CPUs and GPUs, while still relying on internal airflow to cool ancillary components. This hybrid model balances cost and performance — ideal for modular systems.

Expect growth here in sectors like autonomous mobile robotics, where space and battery life are both precious.

Material Science and Additive Manufacturing Are Accelerating Design Cycles

Vendors are using 3D-printed aluminum heat exchangers and lattice-based fins to optimize surface area while reducing mass. Copper remains the top performer thermally, but novel aluminum alloys and even graphene-enhanced composites are being trialed for next-gen systems.

Some designs now integrate cooling channels directly into the structural frame of the chassis — merging mechanical and thermal functions.

The line between structure and cooling is blurring fast. In some cases, it’s the same part.

 

4. Competitive Intelligence and Benchmarking

The in-chassis cooling market isn’t overrun with hundreds of players — and that’s precisely what makes it strategic. Unlike broader thermal markets (like HVAC or rack cooling), this space requires deep integration with system design. The leaders here combine material expertise, precision engineering, and often custom manufacturing. Let’s break down who’s shaping the field.

Boyd Corporation

A long-time leader in engineered thermal solutions, Boyd has quietly become a go-to vendor for embedded cooling systems. They specialize in vapor chambers, liquid cold plates, and hybrid loop heat pipes — often custom-developed for military, telecom, and rugged edge platforms.

What sets Boyd apart? Their ability to integrate thermal, EMI, and environmental sealing into a single module. This makes them a favorite among defense OEMs and industrial PC builders looking for drop-in subsystems.

Aavid (now part of Boyd, but still known independently)

Before its acquisition, Aavid was known for heat sinks and air-based cooling. Post-merger, the brand continues to carry weight in passive cooling — especially high-density fin arrays and custom cold plate layouts.

They still serve sectors like aerospace and embedded computing where fanless , vibration-resistant cooling is key.

Advanced Cooling Technologies (ACT)

ACT is a standout in the two-phase space — particularly with loop heat pipes and vapor chamber solutions. Their systems are used in satellites, military drones, and field-deployed rugged systems where airflow is impossible or undesirable.

One of their key innovations is in capillary-driven heat transport inside compact enclosures. Their R&D collaborations with NASA and the DoD have helped them refine systems that now show up in edge compute devices and secure comms systems.

CoolIT Systems

Best known in the data center and high-performance computing (HPC) world, CoolIT is expanding its reach into modular in-chassis liquid cooling. While many competitors focus on external rack-scale solutions, CoolIT has introduced closed-loop direct-to-chip coolers designed for blade servers and micro data centers.

They’re making inroads with telecom and edge cloud vendors who need scalable but low-maintenance liquid systems.

Laird Thermal Systems

Laird offers a strong portfolio in active thermal management — including thermoelectric coolers (TECs), which are still used in specific in-chassis applications. These are less common in general computing but highly relevant in optical sensors, laser control, and some RF applications inside sealed systems.

Laird also brings design tools that allow OEMs to simulate and optimize thermals early in the design cycle — a key differentiator in fast-turn industries.

TE Connectivity / Advanced Thermal Solutions

TE has extended its play into thermal interface materials and embedded thermal modules. Their strength lies in passive components — heat sinks, vapor spreaders, and high-performance TIMs — but they also collaborate with OEMs on ruggedized packaging.

They’re often not the system integrator but the part everyone else builds around.

Competitive Dynamics in 2024:

• Boyd and ACT dominate in aerospace, defense, and rugged systems — where thermal failure is mission-critical.

• CoolIT leads in HPC-grade liquid cooling now being adapted into edge-ready formats.

• Laird and TE are crucial enablers for hybrid cooling setups, especially where electronics must be sealed.

And while startups are popping up with modular cold plate kits or CFD-tuned fan systems, it’s the supply-chain integration and custom design capacity that separate the leaders from commodity providers.

 

5. Regional Landscape and Adoption Outlook

Thermal challenges are universal — but the urgency to address them inside the chassis varies depending on regulatory environments, compute density trends, and even climate. In-chassis cooling adoption doesn’t follow a traditional enterprise IT curve. Instead, it maps closely to industrial, telecom, and defense innovation cycles. Here's a regional view of where things stand — and where they’re headed.

North America

This region leads in high-value, high-performance deployments. From rugged edge AI systems to next-gen military electronics, thermal performance is treated as a design constraint, not an afterthought.

A few key drivers:

• Rapid growth in GPU-heavy edge deployments (especially in logistics, defense, and autonomous systems)

• Strong aerospace and defense demand for fanless and shock-resistant cooling systems

• Venture-backed startups targeting modular edge AI — often requiring liquid or hybrid cooling

The U.S. Department of Defense is funding in-chassis thermal R&D through DARPA and related agencies. And hyperscalers are backing edge initiatives that push more compute closer to users — demanding high-performance in smaller footprints.

If you're deploying 10-kW worth of AI compute in a box the size of a microwave, you’re doing it here.

Europe

Europe is more cautious — but also more sustainability-focused. Regulatory pressure is leading to widespread adoption of energy-efficient, low-maintenance thermal systems.

Germany, Sweden, and the Netherlands are investing heavily in passive and two-phase cooling for telecom and public infrastructure compute nodes. EU directives are pushing OEMs to publish thermal performance and lifecycle energy usage, which elevates the importance of in-chassis efficiency.

Eastern Europe is also emerging as a stronghold for rugged industrial compute — particularly in automation and surveillance sectors. These projects often specify loop heat pipes and sealed fanless systems.

Expect growth in:

• Cold climate deployments that still need sealed systems (telecom base stations)

• Edge AI hubs in public transit and infrastructure

• Long-life embedded control units in rail, energy, and smart city applications

Asia Pacific

By volume, this is the fastest-growing region. China, South Korea, Japan, and India are all investing in edge compute infrastructure — from smart factories and AI cameras to citywide surveillance and logistics automation.

China’s drive toward AI self-sufficiency has triggered a spike in board-level compute deployments — many of which operate in thermally constrained environments with limited maintenance access. Japan’s industrial robotics sector is demanding highly compact, ultra-reliable fanless cooling solutions — including thermoelectric and passive vapor chamber setups.

Telcos in Southeast Asia are also deploying 5G base stations with embedded AI processing. These sealed systems require internal liquid or hybrid thermal solutions — often with minimal serviceability.

Key challenges in APAC include inconsistent access to high-quality thermal components in some markets and a lack of design-level thermal expertise outside Tier 1 OEMs.

That said, this region is where scale meets urgency. And as deployments ramp, the demand for plug-and-play in-chassis cooling modules will explode.

Latin America, Middle East & Africa (LAMEA)

This is the frontier zone. Adoption is slower, but where it’s happening, it’s often driven by defense, mining, and telecom modernization.

In the Middle East, countries like Saudi Arabia and the UAE are funding smart surveillance, logistics, and urban AI systems — many of which require sealed, passively cooled enclosures. South Africa and Brazil are showing growth in rugged industrial systems, especially in mining and infrastructure.

Challenges here include:

• Higher import costs for advanced thermal materials

• Fewer local integrators with in-house thermal engineering capacity

• Harsh climate zones that require robust thermal designs

Still, demand is picking up — especially in national telecom projects and defense-led edge AI programs.

 

6. End-User Dynamics and Use Case

The in-chassis cooling market doesn’t revolve around consumer behavior — it revolves around system-critical uptime. That means every end user — whether it’s a defense integrator, telecom OEM, or industrial automation firm — has different performance requirements, budget tolerances, and environmental constraints. Here's how that plays out across buyer types.

Defense & Aerospace Integrators

These are the most demanding end users — and for good reason. Their compute platforms often go into environments where heat must be dissipated silently, with zero moving parts, and with extreme shock and vibration resistance.

Typical deployments:

• AI and signal processing in battlefield edge nodes

• Tactical computing for autonomous drones and ground vehicles

• Secure communications systems in aircraft or naval enclosures

Most of these systems rely on passive cooling: loop heat pipes, vapor chambers, and embedded heat spreaders integrated into the chassis walls. Liquid cooling is rare due to vibration and reliability risks, but in enclosed submarines or aircraft, sealed thermoelectric systems are starting to gain traction.

Telecom & 5G OEMs

These players are racing to deploy small form factor edge compute inside base stations, antenna mounts, and metro-level infrastructure. Cooling here must be:

• Fanless or low-maintenance

• Dust- and moisture-resistant

• Scalable across tens of thousands of installations

Cold plates and hybrid systems are now being embedded directly onto SoC boards or mezzanine GPUs, with in-chassis airflow playing a secondary role. Some vendors are even incorporating heat pipes into the board-level layout — treating thermal design as a layout constraint, not an afterthought.

It’s not uncommon for a telecom OEM to spec a 150W heat load inside a chassis smaller than a shoebox, mounted to a pole in 45°C heat — with no fan and no service window.

Industrial Automation Firms

Automation platforms are moving from PLC logic to edge AI — and the thermal envelope is shrinking. Industrial PCs, machine vision systems, and robotics controllers now often operate inside sealed cabinets with minimal airflow.

This is where modular in-chassis cold plates and copper heat pipe solutions shine. System integrators often prefer vendors that offer customizable thermal “kits” — designed to fit inside legacy enclosures.

Downtime is expensive in this segment. So cooling isn’t just a thermal problem — it’s a productivity constraint.

Edge AI Solution Providers

Startups and cloud vendors are deploying portable, low-latency compute nodes in retail, logistics, healthcare, and smart infrastructure. These edge boxes are small, packed with GPU and AI accelerators, and often mounted in thermally tough environments.

In-chassis liquid and hybrid cooling systems allow for higher density without performance throttling. This is especially critical when latency and uptime are non-negotiable — for example, in autonomous vehicle compute modules or real-time surgical robotics.

Use Case Highlight

A multinational logistics company rolled out edge AI processing boxes across 200 warehouse sites globally. Each system was built to run real-time video analytics using high-power GPUs in sealed enclosures mounted near loading docks — often in unconditioned air.

Early deployments using air-cooled systems suffered from thermal throttling, especially in warmer regions. The vendor replaced the internal air-based heat sink setup with a two-phase loop heat pipe solution bonded to the GPU and heat spreader wall. The result?

• 18% improvement in sustained compute performance

• 70% drop in thermal-related system alerts

• Zero maintenance over 24 months

More importantly, the system became deployable in more locations — allowing the logistics firm to accelerate its AI rollout without waiting for HVAC retrofits.

 

7. Recent Developments + Opportunities & Restraints

Recent Developments (2023–2025)

• Boyd Corporation launched a new line of high-density cold plate assemblies designed for edge AI systems, targeting telecom and industrial computing markets. These units feature integrated quick- disconnects and custom manifold configurations for modular installations.

• CoolIT Systems introduced a closed-loop in-chassis cooling solution aimed at GPU-dense microservers . The system, announced in 2024, supports up to 900W of board-level heat load and fits into standard 2U and 3U enclosures.

• ACT (Advanced Cooling Technologies) unveiled a next-gen loop heat pipe design for compact vertical enclosures. The system, currently being tested in military-grade UAV payloads, is engineered to operate at high-G accelerations and extreme altitudes without failure.

• Laird Thermal Systems rolled out a thermoelectric cooling controller designed for sealed-edge optical modules. The unit uses onboard sensors to dynamically modulate cooling based on ambient temperature and component TDP in real time.

• A European defense integrator completed a successful pilot of passive vapor chamber cooling integrated into its autonomous ground vehicle platform. The system operated without fans for 1,000+ hours in desert conditions during a NATO-led exercise in 2024.

These developments aren’t just technical upgrades — they reflect a broader shift toward modular, service-free cooling architectures that work in high-density, low-access environments.

 

Opportunities

1. Edge AI and Telecom Infrastructure The global expansion of 5G and real-time AI workloads is generating massive demand for edge compute boxes — most of which operate in sealed or semi-sealed enclosures. This is a huge opening for vendors offering scalable, drop-in in-chassis cooling systems.

2. Defense Modernization and Battlefield Compute Next-gen battlefield compute requires embedded AI, low SWaP -C, and thermal resilience. Passive and two-phase systems are quickly becoming a standard spec — especially for drones, ground vehicles, and field comms . Vendors who understand MIL-STD design constraints are well positioned.

3. Liquid + Passive Hybridization at the Board Level Designers are increasingly mixing passive loop heat pipes with localized cold plates to manage hotspots. OEMs want off-the-shelf hybrid kits they can adapt across multiple SKUs. This is a whitespace that integrators and materials specialists can fill.

 

Restraints

1. System Integration Complexity Liquid and hybrid systems introduce new design variables — from pump control to leak prevention to board-level thermal mapping. Not all OEMs have the in-house expertise to spec, integrate, and test these systems without support.

2. Cost and Retrofit Limitations While in-chassis cooling pays off over time (reduced downtime, higher density), the upfront cost — especially for retrofits — can be hard to justify in budget-constrained verticals like SMB industrial automation or lower-tier telecom deployments.

 

7.1. Report Coverage Table

Report Attribute	Details
Forecast Period	2024 – 2030
Market Size Value in 2024	USD 2.9 Billion
Revenue Forecast in 2030	USD 5.2 Billion
Overall Growth Rate	CAGR of 9.7% (2024 – 2030)
Base Year for Estimation	2024
Historical Data	2019 – 2023
Unit	USD Million, CAGR (2024 – 2030)
Segmentation	By Cooling Technology, By Application, By End User, By Region
By Cooling Technology	Air-Based Cooling, Liquid Cooling, Two-Phase Cooling (Vapor Chambers, Loop Heat Pipes)
By Application	Edge Computing, Telecom & 5G, Industrial Automation, Defense & Aerospace
By End User	Data Center Operators, OEMs/System Integrators, Defense Contractors, Industrial Equipment Providers
By Region	North America, Europe, Asia-Pacific, Latin America, Middle East & Africa
Country Scope	U.S., Germany, China, Japan, India, South Korea, Brazil, UAE
Market Drivers	- Rising compute density in edge/telecom systems - Growth in fanless and passive cooling needs for rugged devices - Regulatory push for thermal efficiency and sustainability
Customization Option	Available upon request