Heavy Construction Equipment Market Growth Analysis | 2023-2028

Market Insights

The heavy construction equipment market was estimated at USD 193.5 billion in 2022 and is likely to grow at a CAGR of 5.0% during 2023-2028 to reach USD 260.04 billion in 2028.

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Market Dynamics

Introduction

Heavy construction equipment refers to a broad category of machinery designed for use in large-scale construction projects and infrastructure development. These robust and powerful machines are crucial for various tasks, contributing to the efficiency and productivity of construction operations.

The heavy construction equipment market is influenced by factors such as infrastructure development, urbanization, and the demand for efficient and advanced machinery. Technological innovations, such as the integration of telematics and automation, are transforming the industry, enhancing safety, precision, and overall project efficiency. The market plays a vital role in shaping the landscape of construction activities globally.

Market Drivers

• Rising investments in infrastructure: Rising investments in infrastructure and construction sector has contributed to the growth of this market. With the growing population globally, wherein 55% of the world’s population lives in urban areas, a proportion that is expected to increase to 68% by 2050, facilitating the growth of this sector as people are moving from rural areas to urban areas. According to Oxford Economics, worldwide spending for infrastructure will exceed $9 trillion by 2025.
• Growth of mining industry: Another driving factor is the mining industry which facilitates economic development, contributing significantly to the GDP of the country. Mining involves extracting minerals from earth which requires heavy construction equipment. Additionally, the mining industry contributes approximately $1.9 trillion to the global economy each year.

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Challenges:

• High cost of equipment: The high cost of purchase of the heavy construction equipment poses a significant barrier. The high initial investments driven by complex manufacturing, technology integration, material costs, and labour costs will restrict some of the small and medium construction companies to investing in newer advanced technology machines, resulting in the higher requirement of manual power.
• Maintenance and breakdown of the equipment: Another significant challenge faced by this market is the timely maintenance of this equipment. At times, breakdowns or malfunctions of this equipment can be expensive and can cause delays in project completion.
• Shortage of skilled operators: The shortage of skilled and competent labour is another issue faced by the heavy construction equipment market. A portion of the skilled labour force in this market is nearing retirement age. According to some reports, a wave of retirements is expected over the next decade, creating a gap that is not being filled at the same rate by younger workers.

Segment Analysis

By Machinery Type

“Material handling equipment is expected to remain the largest and the fastest-growing equipment type in the market during the forecast period.”

The heavy construction equipment market is segmented into earthmoving equipment, heavy construction vehicles, and material handling equipment. Material handling equipment is the leading segment and is expected to remain the fastest-growing equipment type in the market.

Material handling equipment like cranes, forklifts, conveyer belts, excavators, etc. are employed for the movement, storage, control, and protection of products and goods. A growing number of infrastructural developments, like new bridge construction and the building of high-rise structures that need effective and adaptable material handling solutions, is likely to foster the growth of this segment.

By Propulsion Type

“The electric propulsion type is poised to maintain its dominance and exhibit the highest growth rate in the market during the forecast period.”

The market is divided into ICE (internal combustion engine) and electric. The electric propulsion type is and will be the fastest-growing equipment type in the coming years, as it promotes sustainable construction practices, like lowering carbon emissions and noise pollution and increasing energy efficiency.

As the industry strives to make construction more eco-friendly, manufacturers of heavy equipment are making available all-electric models of conventional construction vehicles like excavators, loaders, forklifts, and other heavy machinery.

By Engine Capacity Type

“5-10L engine capacity is anticipated to maintain its dominance and grow at a faster rate in the market.”

The market is divided into <5L, 5-10L, and >10L. An engine with a capacity of 5-10L is expected to grow at a faster rate and continue to dominate the market due to its high performance, versatility, and efficiency. Roadrollers, crawlers, excavators, etc. are the construction equipment with this type of engine.

5-10L engine construction equipment utility is mostly for ground-level construction like roads, railways, and dams; therefore, investments in these commercial projects are fueling the growth of 5-10L engine capacity type.

By Power Output Type

“Less than 100 HP engine capacity is anticipated to maintain its dominance and grow at a faster rate in the market.”

The market is bifurcated into less than 100 HP, 101-200 HP, 201-400 HP, and over 400 HP. Less than 100 HP power output type engine is expected to retain its leadership and expand at a higher rate in the market due to its lightweight and compact size, making it easier to operate in the isolated and narrow spaces. Equipment with less than 100 HP such as mini excavators and compact loaders, is ideal for working in compact spaces.

By End-User Industry type

“Infrastructure development is anticipated to maintain its dominance and grow at a faster rate in the market.”

The market is divided into building and construction, forestry and agriculture, mining, and others. Infrastructure development is expected to grow at a faster rate in the market due the increasing investments by various governments across the globe.

Infrastructure development, such as transportation networks, energy infrastructure, water control, and communication networks, necessitates the application of heavy construction equipment. These construction equipment helps maximize the rate of construction and lower the manual power

Regional Insights

Asia-Pacific region is leading the heavy construction equipment market and is expected to remain dominant during the forecast period, driven by the rising population, growing infrastructural development, rapid urbanization, and industrialization.

54% of the global urban population, more than 2.2 billion people, live in Asia. By 2050, the urban population in Asia is expected to grow by 50%, with the Asia-Pacific region being the most populated region across the globe, owing significantly to the rapid urbanization, which is pushing the need for infrastructural developments and in turn facilitating the growth of the heavy construction equipment market.

Along with the infrastructural development, mining industry is also the significant end user of the heavy construction equipment market in this region due to the high demand of minerals and metals from the rapidly growing economies like China and India.

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Key Players

The following are the key players in the market:

• Caterpillar
• CNH Industrial N.V.
• HD Hyundai
• Hitachi Construction Machinery Co., Ltd.
• Komatsu
• Liebherr AG
• SANY Heavy Industry Co., Ltd.
• Terex Corporation
• Volvo Group
• XCMG Group

Note: The above list does not necessarily include all the top players in the market.

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Research Methodology

This strategic assessment report from Stratview Research provides a comprehensive analysis that reflects today’s heavy construction equipment market realities and future market possibilities for the forecast period. The report segments and analyzes the market in the most detailed manner in order to provide a panoramic view of the market. The vital data/information provided in the report can play a crucial role for market participants as well as investors in the identification of the low-hanging fruits available in the market as well as to formulate the growth strategies to expedite their growth process.

This report offers high-quality insights and is the outcome of a detailed research methodology comprising extensive secondary research, rigorous primary interviews with industry stakeholders, and validation and triangulation with Stratview Research’s internal database and statistical tools. More than 1,000 authenticated secondary sources, such as company annual reports, fact books, press releases, journals, investor presentations, white papers, patents, and articles, have been leveraged to gather the data. We conducted more than 15 detailed primary interviews with market players across the value chain in all four regions and industry experts to obtain both qualitative and quantitative insights.

Report Features

This report provides market intelligence in the most comprehensive way. The report structure has been kept such that it offers maximum business value. It provides critical insights into market dynamics and will enable strategic decision-making for existing market players as well as those willing to enter the market. The following are the key features of the report:

• Market structure: Overview, industry life cycle analysis, supply chain analysis.
• Market environment analysis: Growth drivers and constraints, Porter’s five forces analysis, SWOT analysis.
• Market trend and forecast analysis.
• Market segment trend and forecast.
• Competitive landscape and dynamics: Market share, Service portfolio, New Product Launches, etc.
• COVID-19 impact and its recovery curve
• Attractive market segments and associated growth opportunities.
• Emerging trends.
• Strategic growth opportunities for the existing and new players.
• Key success factors.

Market Segmentation

This report studies the market, covering a period of 12 years of trend and forecast. The report provides detailed insights into the market dynamics to enable informed business decision-making and growth strategy formulation based on the opportunities present in the market.

The heavy construction equipment market is segmented into the following categories:

By Machinery Type

• Earthmoving Equipment
• Material Handling Equipment
• Heavy Construction Vehicles

By Propulsion Type

• Diesel
• CNG/LNG/RNG
• Electric

By Engine Capacity Type

• Less than 5L
• 5-10L
• More than 10L

By Power Output Type

• Less than 100 HP
• 101-200 HP
• 201-400 HP
• more than 400 HP

By End-User Industry Type

• Building and Construction
• Forestry and Agriculture
• Infrastructure
• Mining
• Others

By Region

• North America (Country Analysis: The USA, Canada, and Mexico)
• Europe (Country Analysis: Germany, France, The UK, Russia, and The Rest of Europe)
• Asia-Pacific (Country Analysis: Japan, China, India, and The Rest of Asia-Pacific)
• Rest of the World (Country Analysis: Brazil, Saudi Arabia, and Others)

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Report Customization Options

With this detailed report, Stratview Research offers one of the following free customization options to our respectable clients:

Company Profiling

• Detailed profiling of additional market players (up to three players)
• SWOT analysis of key players (up to three players)

Competitive Benchmarking

• Benchmarking of key players on the following parameters: Product portfolio, geographical reach, regional presence, and strategic alliances

Custom Research: Stratview Research offers custom research services across sectors. In case of any custom research requirement related to market assessment, competitive benchmarking, sourcing and procurement, target screening, and others, please send your inquiry to sales@stratviewresearch.com.