EQUIPMENT SALES

WHAT HAPPENED?

Off-Highway Research has announced its predictions for global construction equipment sales for 2024, estimating that sales will fall 8% this year to 1.08 million units, following the 7% decline of 2023 and 6% drop in 2022. The company highlighted that these declines come after the abnormally high volume of machines sold in 2021 and describes it as a ‘return to normal’.

Off-Highway Research managing director, Chris Sleight said, “The construction equipment industry is a cyclical market. Downturns normally come with double-digit percentage falls in year-on-year equipment sales. Three years of single digit declines classify the current readjustment as a soft landing.”

For 2024 the company predicts a 6% decline for construction equipment sales in Europe, a 4% decline in China, a 10% decline in India, a 1-2% increase in Japan, a 10% decline in North America and a 3% increase in South America.

WHAT IT MEANS

Construction is a resilient industry, as well as traditionally a cyclical one, meaning that sales often rise until they get to a point where they are unsustainable and come crashing down. In recent years the sector has seen some of its highest ever sales, with global units sold estimated to be in excess of 1.3 million in 2021, the most ever recorded.

Against this background the decline in sales since 2021 has indeed been ‘soft’ – sales remained historically high in 2022 and were still strong in 2023.

Hopefully, the industry has avoided some of the steep declines it has seen in the past and sales will grow in the future at a rate that may be slower, but more sustainable.

WHAT’S NEXT?

Construction equipment sales are expected to pick up across all regions from the mid-2020s onwards. The long-term growth trend for the industry should mean that the extraordinary volumes achieved in 2021 might be regained towards the end of the decade as part of normal and sustainable cyclical growth. Sales in both 2027 and 2028 are predicted to exceed the 1.2 million mark.

The Chinese market is expected to recover and see sales slowly increase from 2024 onwards. Europe should remain steady and the North American market is predicted to remain relatively strong for the forseeable future.

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