A recent study by Grand View Research, Inc. revealed that the worldwide construction equipments market was worth USD 138 billion in 2012. It is estimated to grow at a CAGR of 5% from 2014 to 2020.
Construction equipments are increasingly being used in areas other than agriculture. Modern construction equipments are technologically advanced. They, therefore, attract demand from diverse industries like railways and military. Accelerated infrastructural development in several parts of the world is the foremost reason for the sound growth of the construction equipments market.
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Apart from this, expansion in the mining industry will also create greater demand for heavy equipments like earth movers, drills, bulldozers, etc. Furthermore, Grand View Research also notes that earth moving equipments accounted for more than 40% of the total market in 2013. This sector includes excavators, loaders and other equipments for making structures and digging trenches.
Earth moving equipments would dominate the overall market in the coming years. Material handling equipments, with a CAGR of 5.5%, are likely to witness the fastest growth till 2020. This can be attributed to the rising automation and application industries. Concrete equipments are of great importance in the construction of power plants, bridges, residential and commercial establishments, etc.
They would profit from highway construction projects expected to commence in the near future. Grand View Research divides the construction equipments market into four geographical regions – North America, Asia Pacific, Europe and Rest of the World (ROW). ROW, with a CAGR of 6%, is predicted to be the fastest growing region by 2020.
High number of construction projects in Brazil will contribute to its growth. Asia Pacific contributed more than 49% of the total revenue in 2013. It is expected to be the largest construction equipments market in the forthcoming years. Multiple infrastructural projects coupled with increasing mechanization in the construction industry will positively affect this region.
China, in particular, will be an important source of revenue for the Asian Pacific market. Grand View Research identifies John Deere, Caterpillar Inc., Volvo Construction Equipment AB, Doosan Corporation, Komatsu Ltd., JCB Ltd., and Hitachi Construction Machinery Co., Ltd. as the chief participants in the construction equipments market.
Mergers and acquisitions are the essential strategies for achieving penetration. Many manufacturers invest in the research and development of better and diverse products. Compliance with regulatory norms pertaining to emission control and workplace safety is a key industry consideration.
Players of the worldwide market also face challenges in the forms of high capital and maintenance costs, and economic upheavals in emerging countries.