‘Record’ construction sales predicted for 2021
19 August 2021
Global construction equipment sales are expected to hit a record high of 1.13 million units, with a value of almost US$110 billion this year, according to updated forecasts from specialist consultant Off-Highway Research.
This figure of 1.13 million units this year would be 2% higher than the previous record of 1.11 million machines, which was achieved in 2018.
This peak in sales was not forecast before the Covid-19 pandemic – Off-Highway believes the record-high will come about due to the stimulus response to the virus by governments around the world, most significantly in China.
A programme of special bond issues by provincial governments in 2020 to raise funds for infrastructure spending and other stimulus saw the Chinese market rise 30%. That growth continued into the first quarter of 2021, but the Chinese market has slowed since. A 2% decline in sales is expected for the year as a whole, but volumes in China will remain at a very high level in historic terms.
While China is slowing, the rebound in many other parts of the world is proving more robust than was anticipated at the start of this year. The European market is projected to rise 15% in 2021, as opposed to the previous forecast of single-digit growth. This should see volumes rebound to similar levels to the cyclical high which was seen in 2019.
Likewise, the forecast for North America has been upgraded to a 13% increase. While this will not see it regain the highs of 2019, these levels should be reached and surpassed in the following years.
A modest 1% rise in construction equipment sales is now forecast for Japan in 2021, as opposed to the previous expectation of a downturn. This rise will build on the modest increase in sales which was seen in 2020 as the government increased spending on public works and take the market to its highest since the early 2010s.
However, the forecast for India has been downgraded from the previously expected 15% increase to an 11% rise in sales this year. This is due to the second wave of Covid infections which swept through the country in the second quarter of 2021.
The outlook for the rest of the world remains unchanged, with the expectation of a 6% rise in sales this year.
Off-Highway Research managing director, Chris Sleight, said, “The global rebound in equipment sales over the last six to nine months has been striking. While this is excellent news, the industry still faces many challenges in meeting this demand, including supply chain constraints and bottlenecks around shipping and other logistics.
“I believe that, without these, sales this year might have been even higher than the record volumes we are predicting. However, the positive in this is that the current buoyancy should extend well into 2022 as a result.”