The construction equipment manufacturing industry is likely to grow to $82.2 billion this year according a new report by research firm IBISWorld. Even though the industry has slowed the past couple of years, the construction equipment manufacturing industry has averaged an annual growth of 17.7 percent the past five years.
Domestic demands surged for construction equipment in China from 2009 to 2011, with many manufacturers investing heavily in new plants and in acquisitions to expand product categories and production capacity. After a drop in 2012 as the Chinese economy slowed, capital investment is expected to increase in 2013, promoting market demand for construction equipment.
The Chinese construction equipment manufacturing industry is considerably fragmented, which reflects the diverse nature of the industry’s products, the IBISWorld report says. Firms tend to focus on particular equipment or markets and the majority of the enterprises manufacture single products or machine parts. The top four manufacturers — Sany, Changsha Zoomlion Heavy Industry, Guangxi LiuGong Machinery and Japanese manufacturer Komatsu — account for 25.8 percent of industry revenue.
Many domestic Chinese brands have become more influential in the global market, while competing imports have decreased. Other trends developing in this industry include greater merger activity, outsourcing of spare part manufacturing, growth in equipment rental and leasing and an increased foreign presence, the IBISWorld report says.
More information about Los Angeles-based IBISWorld’s reports can be found at www.ibisworld.com.