Construction equipment are very important resources for infrastructure projects and for other modern-day constructions, where the magnitude of the work is on a large scale. Any major construction projects utilize equipment for most of the work and the choice of equipment defines the construction method along with the time and cost for the project. Construction equipment have certain advantages, such as, to carry out activities which cannot be done manually along with reducing overall cost of construction. Some of the construction equipment include graders, loaders, trenchers, excavators and other equipment.
The market for construction equipment is anticipated to record a CAGR of around 4.5% over the forecast period, 2020-2028. The major key factor expected to boost the market growth includes the rise in the public-private partnerships to implement the infrastructure. These partnerships are for construction of public infrastructure systems, where a private company lends its expertise for the government projects. Further, increase in the urbanization all over the globe is increasing the demand for the construction equipment to build infrastructure such as roads, bridges, residential areas and commercial buildings.
The solution type market is segmented into products and services, out of which, the products segment is anticipated to dominate the market in terms of revenue over the forecast period on the back of increase in the construction projects along with the demand for customized equipment, in order to complete the projects in shortest period of time. Further, initiatives by the government for the development of economy, is also going to boost the market growth.
The demand for construction equipment for the development of smart cities, metros in urban areas and commercial buildings all over the world is rising and in order to meet this demand, the government is spending a huge amount in the construction sector. Further, in order to save the cost of machinery and the maintenance, construction firms prefer to take equipment on rental basis especially modern automated equipment. This provides a huge opportunity for many companies to enter into the construction equipment rental business for its high profitability. These factors are anticipated to drive the market growth over the forecast period.
Over the years, most of the developing and developed countries have seen a tremendous growth in construction industry. Furthermore, improved living standards of people are increasing the demand for improved housing. India is one of the countries showing immense growth in construction sector, and for that consistent growth, Indian government has rolled out several policies to allow the development in India. The government has relaxed FDI regulations related to minimum built-up area and capital requirement. This FDI will help the countries to grow economically along with the bridging of the financial gaps. Hence, these investments will boost the market growth over the forecast period.
Technological advancements have increased the efficiency of construction projects by improving the quality of construction practices. However, this advancement also increases the complexities of the business. In order to avoid the expensive breakdowns of heavy equipment, regular maintenance is required. Since, the cost associated with the maintenance is relatively high and in case of breakdown, replacing the component becomes very expensive. Therefore, most of the companies are hesitant to take this measure, which in turn, is acting as a key restraint towards the growth of the market over the forecast period.
Our in-depth analysis of construction equipment market includes the following segments:
On the basis of regional analysis, the construction equipment market is segmented into five major region including North America, Europe, Asia Pacific, Latin America and Middle East & Africa region. The market for construction equipment in North America is prominent and Asia Pacific region is anticipated to dominate the market on the account of improvement in the socio-economic conditions in some of the emerging countries such as India, China and Thailand. Further, the population in India and China is rapidly increasing, which have resulted in an increased number of construction projects such as airports, bridges, metros and renewable energy projects. In order to meet these project requirements, there will be an extensive demand for construction industry in the region. The regions in Middle East & Africa are estimated to grow rapidly owing to the increased infrastructure spending.
The construction equipment market is further classified on the basis of region as follows:
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