Asia/Pacific demand for construction machinery is projected to rise 4.9% per year to $123 billion in 2023, according to the new Freedonia Group study, Global Construction Machinery.
Among the major factors driving the regional market’s rapid growth are:
- Rising labor costs and mechanization rates throughout the region
- Widespread availability of affordable models, many of which are locally produced
- Increasing use of more sophisticated, better performing machinery in mature markets
- Above average growth in both regional construction and mining activity
- Expanding investment in regional infrastructure, such as via China’s Belt & Road Initiative
More information regarding the study is here: https://www.freedoniagroup.com/industry-study/global-construction-machinery-3728.htm
In particular, trends in China – the world’s largest national producer and purchaser of construction machinery – will underlie regional market gains. For example, after a relatively poor sales performance in recent years, replacement product demand in China is expected to rebound. Continued swift economic growth, inflows of foreign investment, and impressive fixed investment spending gains (among other factors) in the country will also bolster sales.
Combined, the loader, crane and dragline, and excavator segments will account for two-thirds of sales gains in China, driven by increases in construction activity and rising mining output. For example:
- Loaders will continue to be used widely in China because of their low price, versatility, and compatibility with numerous attachments.
- As Chinese cities continue to expand, high-rise building construction will increase, generating demand for a wide range of cranes.
- The excavator segment will benefit from a rebound in surface mining activity to a greater extent than other product types.
Contact Corinne Gangloff for an interview with the analyst Gleb Mytko.
Additional Machinery and Equipment studies can be viewed here: https://www.freedoniagroup.com/industry-category/mach/machinery-equipment.htm