Understanding the Heavy-Duty Construction Equipment Market Scenario


  • Published On : Jul 28, 2014
Overview 

Global construction activities are expected to boost the construction equipment industry’s future success. Due to rapid urbanization and the need for construction in different parts of the world, there is a fast-paced requirement for heavy-duty equipment for construction. 

The construction equipment market is driven by key factors such as the emergence of lease-based equipment, rising government investment in infrastructure development, and growth in construction and mining activities, particularly in emerging nations. Also, the demand from companies in real estate and infrastructure is contributing to the growth of this market.

The construction market has been around for a long time, but with changing times and trends, consumer demand has witnessed a transition as competitors vie for a larger share of the construction equipment industry. As construction activities—especially in emerging countries—show an upward trend, the necessity for heavy-duty equipment and related products has become significant.

Construction Equipment Industry: Segmentation

The construction equipment market can be segmented as: heavy construction vehicles, earthmoving, material handling, and other heavy construction equipment. The earth moving equipment consists of backhoes, loaders, excavators, bulldozers. The construction equipment has road rollers, concrete mixers, hot mix plants, road making machines, and stone crushers. Similarly, the materials-handling equipment consists of mobile cranes, forklifts, gantry cranes, hoists, and construction vehicles (dumpers, trailers, tippers, tankers). Earthmoving machinery is a communal term used for a range of equipment. This category typically includes loaders, excavators, crawler dozers, bulldozers, scrappers, and shovels. Of the four mentioned categories, the earthmoving equipment market held the largest market share of 78% in 2012.

Regionally Active Markets in Heavy-Duty Equipment  

From the geographical standpoint, China is predicted to lead the construction equipment market consuming a major portion of the global share; however, South Korea, India, and Indonesia will witness high growth and demand as well. These countries are likely to represent great potential for this market.  

The next promising market for construction equipment is Asia. Due to a relatively high demand for heavy-duty equipment in countries like India and China, the construction and mining industries are expanding in terms of construction products. High investments are also seen in the European construction sector, especially within emerging European economies. The investments had declined by over 0.8% since 2008, but with new building contracts and residential constructions, Europe now holds the second place in the share market of the global construction equipment market. 

By 2017, the global construction equipment market is estimated to be sized at around USD 192.3 billion, growing from USD 143.6 billion in 2012. The market is predicted to grow at a CAGR of 6.0% over the forecast period from 2012 to 2017. China once held the majority of the shares in the global market, but now this region is followed by Europe which holds a second place globally. Among the major construction equipment segments, the earth-moving equipment sector is in the leading position at present. Since 2012, it has contributed 43% of the total revenue in this market. 

Global Industry Leaders in the Heavy-Equipment Market

The worldwide market for construction equipment is characterized by a number of large and small players. Some of the prominent shareholders that play an active part in the construction equipment market are: Volvo (Sweden), Hitachi (Japan), Terex (U.S.), Doosan (South Korea), Caterpillar (U.S.), Liebherr (Switzerland), Sany (China), Zoomlion (China), Komatsu (Japan), and John Deere (U.S.). Among these names, some of the well-known Chinese market players dominating the global market are Guangxi Liugong, XCMG, Zoomlion, Lonking, Sany, and others. Currently, Caterpillar is the leading player in the 
global market for construction equipment.

Presently, the construction equipment market is witnessing a scorching growth pace, albeit it remains highly sensitive to economic conditions globally. The industry is clearly focusing on more efficient and industrious products that have the potential to optimize business and also the capability of providing proficient heavy-duty equipment to customers in every industry vertical.
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