Construction Equipment Aftermarket industry size is set to reach USD 30 billion by 2027, according to a new research report by Global Market Insights Inc.
Rising demand for construction equipment in mining & utility activities is enhancing the construction equipment aftermarket industry growth. Aftermarket parts providers are focusing on the acquisition of other parts suppliers to increase their service offerings.
Increasing residential construction due to the growing population & urbanization in North America is encouraging construction equipment OEMs to strengthen their market presence. For instance, in April 2021, Volvo Construction Equipment expanded its parts distribution center in Reno, Nevada. The company established a 75,000 square-foot parts distribution center to provide quicker parts delivery to Western U.S. clients along with low shipping charges.
Several local players offering counterfeit spare parts at low costs is a major factor challenging the construction equipment aftermarket business. Additionally, the high cost of genuine spare parts and custom taxes on exported parts are other factors limiting industry statistics. Construction equipment owners are significantly emphasizing on purchasing new equipment with integrated fleet management and telematics solutions, which can negatively affect the market.
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Analyst view: “Proliferation of construction and mining activities is driving the construction equipment aftermarket demand. Frequent use of construction equipment and an increase in the flexibility of these machines is poised to boost the business expansion”.
The COVID-19 pandemic has adversely affected the construction equipment spare parts industry. Industry participants are facing raw material shortages impelled by disruptions in the global supply chain. Inconsistent demand and the unavailability of engineers & labor owing to strict lockdown imposed by the governments to minimize the virus transmission have hampered the production process. Various companies, such as Zoomlion Heavy Industry Science and Technology, Co. Ltd., Sany Global, and The Manitowoc Company, Inc., have shut down their manufacturing plants for their employees’ safety and to optimize their supply.
Browse key industry insights spread across 190 pages with 251 market data tables & 20 figures & charts from the report, “Construction Equipment Aftermarket Size By Product (Earth Moving & Road Building Equipment [Hydraulic Systems, Engine Parts, Axle & Transmission Parts], Material Handling & Cranes [Hydraulic Systems, Engine Parts, Axle & Transmission Parts], Concrete Equipment [Hydraulic Systems, Engine Parts, Axle & Transmission Parts]), By Sales Channel (Online, Offline), COVID-19 Impact Analysis, Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2021 - 2027” in detail along with the table of contents:
Growing usage of material handling equipment for distribution and storage
The Europe material handling equipment spare parts segment is anticipated to grow at 5.5% CAGR from 2021 to 2027. The proliferation of building constructions activities and rising government investments in public transport infrastructure are creating a high demand for material handling equipment.
Demand for cranes in the MEA region is increasing on account of growing government investments in infrastructure development. Crane rental companies are expanding their rental and aftersales services in the region to increase their market share.
Customer preference toward offline sales channel
In 2020, the offline sales channel dominated with around 70% of the revenue share in North America. The availability of a wide product portfolio and reduced product cost are creating market expansion opportunities for offline channels. However, offline sales channels were hit worst by stringent lockdowns imposed by various governments amid the COVID-19 pandemic to curb virus transmission in 2020. Lockdowns forced vendors to shut down their spare parts stores, thereby affecting the offline channel sales growth.
Growing investments in the Europe public and private construction sectors
The Europe construction equipment aftermarket industry is forecast to exceed USD 9 billion by 2027. Increasing construction equipment rental demand and industrial development projects in the region are providing a positive market outlook. Companies including Terex Corporation and Palfinger AG are strengthening their relations with distributors to improve their aftersales services.
Rising demand for construction equipment spare parts is encouraging distributors to extend their product portfolios. Distributors including TopDog Heavy Equipment Parts, TVH Parts Holding NV, and ECS s.r.l are enhancing their product offerings to stay competitive in the market.
Key construction equipment aftermarket players include Volvo Construction Equipment, Komatsu Ltd., Zoomlion Heavy Industry Science and Technology Co., Ltd., The Manitowoc Company, Inc., Caterpillar Inc., Kobelco Construction Machinery Co., Ltd., Sany Global, John Deere., Hitachi Construction Machinery Co., Ltd., Tadano Limited Terex Corporation, and Liebherr Group.