Worldwide demand for heavy construction equipment is projected to rise 5.4 percent annually through 2009 to $106 billion, according to a new study by The Freedonia Group Inc., a Cleveland-based industrial market research firm.
The study, called “World Heavy Construction Equipment” adds that growth will be supported by the expected continued expansion of emerging markets, with high points including Eastern Europe, India and China.
North America will continue to lead Japan and Western Europe, the study says, in overall size of demand and growth potential. The growth prospects of Japan and Western Europe will be hampered by a combination of negative demographic and structure trends, the study says, including aging populations and high levels of regulation and taxation.
Future prospects remain very favorable in China, despite the recent weakening of the construction equipment market as a result of tightening credit policies. The study says construction equipment demand will continue to benefit from China’s aggressive industrialization efforts. Although Eastern Europe faces a declining population, based on the economic turnarounds experienced by other countries joining the European Union, expected infrastructure and economic improvements should help increase demand in that region.
Demand for construction equipment in Japan will benefit from an improvement in fixed investment activity, but is expected to be undercut by soft public sector investments, the study says. Growth is likely to be moderate in Western Europe because of aging populations, political turmoil over the EU and other constraints.
For more information about the study, visit www.freedoniagroup.com.
