Sales surge in China

26 March 2018

Construction equipment sales in China grew 81% last year, according to Off-Highway Research

Construction equipment sales in China grew by a remarkable 81% last year, signalling the end of a painful five-year recession, according to specilist market research and forecasting company, Off-Highway Research.

A total of 251,369 pieces of construction equipment were sold in China in 2017, compared to 138,582 in the previous year. This re-established China ahead of the US as the largest construction equipment market in the world in volume terms.

China graph

Unit sales of construction equipment in China, source: Off-Highway Research

The Chinese market began to recover in the second half of 2016, but the sharp growth of 81% in 2017 exceeded expectations.

There was particularly strong growth in the mobile crane and crawler excavator markets last year, and the increasingly important mini excavator segment also grew well. On the other hand, demand for dump trucks remained weak, and there is no significant demand in China for either backhoe loaders or telescopic handlers.

Off-Highway Research’s Annual Review of the Chinese market stated,“Government infrastructure spending and improving conditions in the Chinese real estate market were the drivers for growth. The government launched a number of new construction programmes to bolster the economy in 2015, but this had little effect until 2016 when there was greater take-up of Public Private Partnerships (PPPs) for project funding. At the same time, the looser money supply stimulated real estate investment.

“In addition to improvements in the infrastructure and commercial property markets, improvements in China’s rural economy resulted in increasing demand for light equipment, which is used for agricultural and small building projects. Increased financial support for rural development and the alleviation of poverty have led to a substantial increase in equipment demand in these areas.”

Continued growth is expected in 2018 but at a much slower pace than last year. In 2019 and beyond, sales are expected to fall away slightly as a result of saturated demand and government controls on investment. Off-Highway Research expects that in the next five years the market should increase to around 250,000 units annually, representing a strong and more sustainable level of demand compared with the last decade.

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