Global Demand for Construction Machinery Will Reach $171 Billion in 2015

World demand for construction machinery is projected to expand 6.5 percent per annum through 2015 to $171 billion, in line with the 2005-2010 rate of increase.

Following severe losses between 2008 and 2010, equipment sales are expected to rebound sharply in North America, Western Europe and Eastern Europe. In contrast, growth in the Africa/Mideast, Asia/Pacific, and Central and South American markets is expected to slow during the 2010-2015 period, as both mining and construction activity in these regions climb at more restrained paces. These and other trends are presented in World Construction Machinery, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

Over half of all additional construction equipment demand generated between 2010 and 2015 will be attributable to the Asia/Pacific region. Sales of construction machinery are predicted to rise nearly seven percent per year through 2015 because of increases in construction spending and mining output. Although this represents healthy gains, the rate of growth is a deceleration from the double-digit annual rates recorded during the 2005-2010 period. India, China, Malaysia and Indonesia are among the Asian countries that will record strong growth. China alone will account for 39 percent of all new equipment demand through 2015.

Construction machinery demand in North America is also forecast to grow nearly seven percent annually between 2010 and 2015, as product sales in the US recover rapidly. Equipment consumption in the US is projected to expand over seven percent per annum during this time, after a dramatic decline between 2007 and 2010 due to turmoil in the residential construction market and the global financial crisis. Mexico is also expected to perform better through 2015, while growth in Canada, on the other hand, will decelerate slightly because of limited increases in construction activity.

Following a period of sizable losses between 2008 and 2010, the East and West European construction machinery markets are expected to show renewed strength as advances in construction spending and mining activity stimulate increases in equipment demand. The adoption of Stage IV emissions standards for off-highway engines by European Union countries, which is expected to drive up the prices of construction machinery, will add to value gains.

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