PUBLISHER: MarketsandMarkets | PRODUCT CODE: 1684186
PUBLISHER: MarketsandMarkets | PRODUCT CODE: 1684186
The compact construction equipment market is projected to grow from USD 39.52 billion in 2025 to USD 56.05 billion by 2032, at a CAGR of 5.1%. The overall market growth is propelled by the continuously increasing government and private investments in residential, non-residential, and commercial sectors in Asian and North American countries. Additionally, the inclination towards the electrification of compact construction equipment globally will boost the demand for compact construction equipment in the coming years.
Scope of the Report | |
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Years Considered for the Study | 2021-2032 |
Base Year | 2024 |
Forecast Period | 2025-2032 |
Units Considered | Volume (Units) and Value (USD Million) |
Segments | By Equipment Type, Power Output, Propulsion Type, Engine Capacity, Function, Electric Equipment Category, Battery Chemistry, Compact Equipment Shipment by OEM, and Region. |
Regions covered | Asia, North America, Europe, The Middle East, and the Rest of the World [RoW] |
Lithium Iron Phosphate (LFP) batteries will be the fastest-growing battery chemistry in the Electric Compact Construction Equipment market.
Lithium Iron Phosphate (LFP) battery growth is propelled by higher demand in the Asian market. LFP batteries offer advantages like high electrochemical stability with low resistance for the flow of charge, better temperature resistance, 80-90% discharge capacity, easy availability of raw materials, a longer life span, and minimal maintenance. SANY's (China) SY19E mini excavator (launched in March 2023) uses LFP battery with a capacity of 22 kWh and power output of 15 kW. Whereas Volvo's (Sweden) L25 electric loader is also equipped with an LFP battery with a capacity of 40kWh. LFP batteries are generally cheaper to manufacture than NMC batteries because they do not require expensive raw materials like nickel, manganese, or cobalt. This results in lower overall production costs. Secondly majority of the battery manufacturers are from China, and mostly LFP batteries are manufactured in the region. Asian compact construction equipment manufacturers export their products to European and North American markets, as these equipment's will be equipped with LFP batteries, the growth of these batteries will also propel in those regions. Though these batteries are low priced, they are heavier than NMC batteries, which is a challenge when equipping them with compact equipment, as they will add additional weight to the equipment and can affect the end performance.
The 2 - 3.5L segment is predicted to be the largest engine capacity segment in the compact construction equipment market.
The 2-3.5L engine range includes equipment like mini excavators, skid steers, and compact track & wheel loaders. The main applications of these engine categories are seen in excavation and earthmoving for residential and infrastructural development projects. These equipment's are estimated to be in higher demand in countries like the US, and India, and a few countries in the Middle East. The demand for Mini excavators is highest in Asia, while the demand for skid steer and compact track loaders is more in the North American region. The driving factors for the demand in these regions is the ongoing investments in the residential sector. According to the US Census Bureau and the US Department of Housing and Urban Development, the residential sector in the country grew by 2.6% compared to 2023. The Indian construction industry is also growing, the industry has received FDIs around USD 3.1 billion in the first half of 2024. The "Make in India" and "Smart Cities Mission" initiatives have fueled the country's demand for compact construction equipment.
Other driving factors for this range of engine capacity is its lower costs, light weight and better fuel economy. As these category of engines will be equipped in mini excavators, and compact track loaders, the overall weight of the equipment will be reduced leading to better maneuverability and ability to operate in confined spaces will increase, which will further propel the demand for equipment;s equipped with these category engines.
"Asia is the second largest compact construction equipment market."
Asia is estimated to hold >21% of the global compact construction equipment market. India and China dominate the Asian compact construction equipment market, accounting for >25% and >20%, respectively, in 2024. As per IBEF, luxury home sales in India have surged by 75% in 2023, doubling their share in total housing sales compared to the previous year, Foreign investors have also pumped around USD 3.1 billion into Indian real estate market. Majority of the urban cities in the country come under smart city programs wherein investments are made for betterment of road and other amenities in the city, this will increase the growth of the residential sector resulting in the increasing demand for compact construction equipments. The Chinese construction industry is also growing, In 2023, the Chinese construction industry accounted for about 6.8% of the country's gross domestic product (GDP). The 2024 budget for China included an expenditure of USD 4 trillion in 2024 for the construction industry, an increase of 3.8% compared to the 2023 Budget. The Chinese government has also planned an additional investment of USD 173 Billion to improve its road infrastructure in 2024. These investments would drive the construction industry in the country.
The region is also the home to majority of the key compact construction manufacturers like, Doosan Bobcat (South Korea), Kubota Corporation (Japan), Komatsu Ltd. (Japan), SANY (China), XCMG (China), and Hitachi Construction Machinery (Japan). The ongoing developments in the construction sector coupled with the presence of key OEMs will drive the growth of the compact construction equipment market in the region.
In-depth interviews were conducted with CEOs, marketing directors, other innovation and strategy directors, and executives from various key organizations operating in this market.
The construction equipment market is led by established players such as Doosan Bobcat (US), JCB (UK), Caterpillar (US), Komatsu Ltd. (Japan), and Kubota Corporation (Japan).
The report will help the market leaders/new entrants with information on the closest approximations of the revenue numbers for the overall compact construction equipment market and the sub-segments. This report will help stakeholders understand the competitive landscape and gain more insights to position their businesses better and plan suitable go-to-market strategies. The report also helps stakeholders understand the market's pulse and provides information on key market drivers, restraints, challenges, and opportunities.
Analysis of Key drivers (Rapid urbanization fueling the demand for compact construction equipment in residential and commercial sectors, Rising Labor costs and shortage of skilled labor), Restraint (Stringent international trade policies and mandates), opportunities (Advancements in hydrogen-propelled compact equipment, Advancements in autonomous compact construction equipment and rapid digitalization of services) and challenges (Supply chain issues for hydrogen and other alternate fuels and Battery related issues in compact construction equipment) influencing the growth of construction equipment market.
Product Development/Innovation: Detailed insights on upcoming technologies, research development activities, and new products & services of the compact construction equipment market.
Market Development: Comprehensive information about the lucrative market - the report analyzes the compact construction equipment market across varied regions.
Market Diversification: Exhaustive information about new products & services, untapped geographies, recent developments, and investments in the compact construction equipment market
Competitive Assessment: In-depth assessment of market shares, growth strategies, and service offerings of leading players like Doosan Bobcat (US), JCB (UK), Caterpillar (US), Komatsu Ltd. (Japan), and Kubota Corporation (Japan), among others in the compact construction equipment market.