Heavy Equipment

Heavy Equipment Market to Hit Sh9.5 Trillion by 2025

Growth will be driven by rising infrastructure development around the world.

Updated on

January 19, 2018

The global heavy construction equipment market is projected to reach Sh9.5 trillion by 2025 driven by a rise in infrastructure development around the world.

According to a new report by Grand View Research, Inc., the sector will post a compound annual growth rate of 5.4 per cent – mainly as a result of increased investments in airports globally to meet the rising demand for air travel.

In Kenya, for example, the total number of passengers travelling via the Jomo Kenyatta International Airport (JKIA) in Nairobi has risen exponentially over the past decade leading to congestion at the facility.

To overcome this, the Kenyan government is undertaking a massive expansion of the airport to raise its capacity from the current six million to 10.3 million passengers per year.

Paris-based international airports operator Groupe ADP has been awarded a contract to design a new passenger terminal at the JKIA – marking the start of a project aimed at increasing the capacity of the airport by more than 70 per cent.

The development of roads and railway transport infrastructure is also expected to boost the heavy construction equipment market as nations seek to promote cross-border trade and industrial growth.

Mega infrastructure projects promote increased construction activities that eventually create a demand for heavy-duty construction equipment.

In October, specialist consultancy Off-Highway Research said it expected global construction equipment sales to grow 16 per cent in 2017, to 810,000 units valued at Sh8.1 trillion. This is, however, 200,000 units less than the last sales peak of 2011 when more than a million units of heavy machinery were sold.

The global equipment market peaked in 2011 on the back of Beijing’s Sh60 trillion stimulus spending programme. This boom was, however, followed by a drop in sales – which saw market demand fall to 25 per cent of its peak size in 2015 and 2016.