Opportunities Galore for Earth Moving Equipment Manufacturers in 2016-2020
The economic growth and increased spending on infrastructural activities has played a huge part in providing the necessary boost to the global heavy construction equipment industry. Of the various segments of heavy construction equipment industry, the earth moving equipment market is the fastest growing across the globe as well as India.
In fact, in India, the industry is expected to grow at a healthy CAGR of 20-25 per cent over the next few years, from FY13-14 levels of about 48000 unites. This would bring the market to between $16 billion and $21 billion by 2020, up from today’s $3 billion. Primarily, two factors will help in this growth of the industry i.e., increase in demand from end-user industries and higher adoption of heavy construction equipment in traditional construction applications. These trends are expected to open plethora of growth opportunities for the earth moving equipment manufacturers in India.
Opportunities galore for moving equipment earth manufacturers
- Demand for is likely to rise as a result of growth in traditional end-user industries including construction and mining. Such an increased use of these equipment in previously traditional applications to speed up projects will be seen especially in time-sensitive projects.
- Urbanisation will also drive the demand to meet residential, commercial and infrastructure development needs.
- New players entering the market will make competition stiffer, thereby, making products more affordable. This will further deepen the markets to cover users with equipment requirements that previously had low access.
- Keeping in mind, the facts that increased productivity and the reliability of equipment ultimately translate into higher profitability from fewer defect-related claims and the avoidance of death penalties, the demand for such equipment will only move northward. End-users will realise that earth moving equipment can significantly reduce the cost of large-scale projects; hence, they will demand more in the future.
- Last but not the least, knowing the clear benefits of using equipment over manual labour and traditional methods like improved quality, timeliness, better project financials and safety, end users will move towards this segment happily.
In a nutshell
The high construction and infrastructural growth, technological developments, their adaptations and rapid urbanisation will fuel the growth of the industry in the country. What else? Increasing government spending on infrastructure development including roads, metro rails, flyovers and commercial complexes will also help further to surge the market growth over the next five years. It is also believed that the industry will see major agreements, contracts, joint ventures, and partnerships in future. These strategies will further aid manufacturers to create a large customer and partner base.
Overall, in the coming five years, the segment will mainly see increased investment in infrastructure, continued dominance of price and value-focused customers, deeper engagement of global Original Equipment Manufacturers (OEMs) in India and increasing opportunities for exports. Thus, by 2020, it is expected that the earth moving equipment industry in India will be sky rocketing.