Electric Construction Equipment Market - Forecast(2024 - 2030)

Electric Construction Equipment Market Overview

The Electric Construction Equipment Market size is forecast to reach USD 41.9 billion by 2030, after growing at a CAGR of 22.4% during the forecast period 2024-2030.  Manufacturers are increasingly prioritizing sustainability and emission reduction, ranging with global efforts to combat climate change. This focus on environmental sustainability is driving the development of electric-powered machinery, reducing reliance on traditional fossil fuels. Advancements in battery technology are enhancing the performance and efficiency of electric construction equipment, enabling longer operational hours and quicker recharging times. This trend is crucial in addressing concerns about downtime and productivity in construction projects. 

There is a growing emphasis on the integration of smart technologies and connectivity features in electric construction equipment. These innovations enable remote monitoring, predictive maintenance, and data-driven decision-making, optimizing equipment utilization and reducing operational costs. Moreover, electric construction equipment is becoming more economically viable as the initial costs of acquisition continue to decrease due to technological advancements and economies of scale. Additionally, regulatory initiatives and incentives promoting the adoption of electric vehicles are influencing construction companies to invest in electric equipment for their fleets, further driving the market demand. Overall, the electric construction equipment sector is experiencing a transformative period characterized by sustainability, technological innovation, cost-effectiveness, and regulatory support.

Report Coverage

The report “Electric Construction Equipment Market – Forecast (2024-2030)”, by IndustryARC, covers an in-depth analysis of the following segments of the Electric Construction Equipment Market.

By Vehicle Type: Excavators, Loaders, Cranes, Compactors, Forklifts, Dozers, Graders, Dumpers and Others
By Propulsion: Hybrid-Electric, Battery-Electric
By Battery Capacity: <50 KwH, 50-200 KwH, 200-500 KwH and >500 KwH
By Battery Type: Lithium-Ion, Lead Acid and Others
By Product: 50 HP, 50-150 HP, 150-300 HP and >300 HP
By End User: Residential, Construction, Industrial, Mining, Agriculture and Others
By Geography:  North America (U.S, Canada, Mexico), Europe (Germany, UK, France, Italy, Spain, Russia, Netherlands and Others), APAC (China, Japan India, South Korea, Australia & New Zealand, Indonesia, Malaysia, Taiwan and Others), South America (Brazil, Argentina, Chile, Colombia and others), and RoW (Middle East and Africa).

Key Takeaways

• APAC held the largest market share with 34% in 2023. The Asia-Pacific region is witnessing an increase in rapid technological advancements are shaping electric construction equipment, with innovations such as improved battery technology, advanced telematics, and autonomous functionalities enhancing efficiency, safety, and productivity on job sites.

• The demand for electric construction equipment is rising owing to the integration of digital solutions, such as IoT sensors, data analytics, and remote monitoring capabilities, is becoming increasingly prevalent in electric construction equipment. These digital tools enable real-time tracking of equipment performance, predictive maintenance, and optimization of operations, enhancing overall productivity and cost-effectiveness. 

• In November 2023, Komatsu Ltd. introduced its 13-ton electric excavator, the PC138E-11, for rental in Japan in early 2024, featuring a high-capacity lithium-ion battery with a cooling system for extended operation time and reduced swing radius. The company aims to expand customer exposure to electric power and gather feedback by offering the PC138E-11 as a rental machine, ranging with its strategy to introduce electrified construction equipment to the market. 

By Vehicle Type - Segment Analysis

Excavators dominated the Electric Construction Equipment Market in 2023. The increasing emphasis on sustainability and environmental regulations is propelling the demand for electric excavators. Electric excavators offer reduced emissions and noise levels compared to their conventional counterparts, ranging with the industry's sustainability goals. In June 2023, Volvo Construction Equipment launched its first mid-size electric excavator, the EC230 Electric, in Europe, offering zero emissions and low noise for select customers. The 23-ton EC230 Electric promises equivalent performance to its diesel counterpart, boasting zero emissions, low vibrations, and faster cycle times. Technological advancements in battery technology are enhancing the performance and efficiency of electric excavators, allowing for longer operational hours and quicker charging times. These advancements address concerns about downtime and productivity, driving the adoption of electric excavators in construction projects. Additionally, the growing availability of charging infrastructure and government incentives for electric vehicle adoption further support the uptake of electric excavators. Overall, the drivers behind the increasing demand for electric excavators include sustainability initiatives, technological advancements, and supportive government policies.

By End User - Segment Analysis

Construction dominated the Electric Construction Equipment Market in 2023. The increasing environmental concerns and government regulations favoring cleaner technologies are pushing construction companies to adopt electric equipment to reduce emissions. Advancements in battery technology have improved the performance and efficiency of electric construction equipment, making them more competitive with traditional diesel-powered machinery. Additionally, rising fuel prices and fluctuating oil markets are incentivizing construction companies to switch to electric equipment to lower operating costs and mitigate risks associated with fossil fuel dependency. In November 2022, Laing O’Rourke unveiled Australia’s inaugural electric construction equipment fleet, comprising 250t crawler cranes and 2.5-tonne telehandlers, aiming to achieve operational net zero by 2030. Managed by Select Plant Australia, the fleet reduces emissions and enhances operational efficiency, showcasing the company's commitment to sustainability and industry leadership. Moreover, the increasing focus on sustainability and corporate social responsibility is driving demand for electric construction equipment among environmentally conscious consumers and businesses. Furthermore, technological advancements such as telematics and IoT integration in electric construction equipment are enhancing fleet management capabilities, improving productivity, and reducing downtime, thereby driving market growth. Overall, these factors collectively contribute to the growth and adoption of electric construction equipment in the market.

By Geography - Segment Analysis

Asia Pacific dominated the Electric Construction Equipment Market in 2023. The Asia Pacific Electric Construction Equipment market is supported by stringent emission regulations imposed by governments and environmental agencies compel construction companies to adopt cleaner technologies, driving the demand for electric construction equipment. Moreover, advancements in battery technology, particularly in Asia Pacific's robust tech industry, contribute to the development of more efficient and powerful batteries for electric construction equipment, enhancing their performance and usability. In June 2023 Volvo CE, alongside senior leaders from major construction firms and dealers across Southeast Asia, unveiled three models: the ECR25 Electric compact excavator, the L25 Electric compact wheel loader, and the EC55 Electric excavator in Southeast Asia's premier electric construction machines in Singapore, ranging with their goal of achieving net-zero emissions by 2040 and reducing emissions from their product line by 30% by 2030. The launch, attended by VIPs including Jenny Egermark from The Embassy of Sweden in Singapore, highlights Volvo's commitment to sustainability and innovation in the construction sector. The push towards sustainability and corporate social responsibility initiatives motivates construction firms to invest in eco-friendly solutions, including electric machinery, to reduce their carbon footprint, drives the adoption of electric construction equipment in the Asia Pacific market. 

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Drivers – Electric Construction Equipment Market

• Rising fuel prices drive interest in electric construction equipment for cost-effectiveness.

According to the National Development and Reform Commission (NDRC), retail gasoline and diesel prices in China have increased by 55 yuan ($7.55) per ton, resulting in a rise of approximately 2.5 yuan ($0.34) for a tank of gasoline or diesel. The NDRC adjusts local retail oil prices every 10 working days in alignment with international prices, ensuring prompt adjustments if the price per barrel exceeds $130 or falls below $40. As fuel costs escalate, construction companies are increasingly drawn to electric alternatives for their cost-effectiveness. Electric construction equipment offers a compelling solution by minimizing reliance on traditional fuel sources, thereby reducing operating expenses over the long term. This cost-effectiveness is particularly attractive amidst volatile fuel markets, where unpredictable price fluctuations can significantly impact construction project budgets. 
Moreover, electric machinery presents an opportunity for construction companies to mitigate financial risks associated with escalating fuel costs, ensuring greater financial stability and predictability in project planning and execution. Additionally, the environmental benefits of electric equipment, including lower emissions and reduced carbon footprint, position with sustainability goals embraced by many construction firms, further enhancing the appeal of electric construction machinery. Consequently, the increasing interest in electric construction equipment driven by rising fuel prices is reshaping the construction industry landscape, promoting innovation, and driving market growth.

• Increasing focus on sustainability drives demand for electric equipment in construction projects.

As environmental concerns continue to escalate globally, construction companies are increasingly seeking eco-friendly solutions to minimize their carbon footprint and comply with stringent regulations. Sustainability has become a key priority for stakeholders across the construction industry, from project developers to contractors and equipment manufacturers. Electric construction equipment offers a viable alternative to traditional diesel-powered machinery, significantly reducing greenhouse gas emissions and noise pollution on job sites. Moreover, the adoption of electric equipment positions with corporate sustainability goals and enhances brand reputation by showcasing commitment to environmental stewardship. The emphasis on sustainability not only drives demand for electric construction equipment but also supports innovation in the industry, leading to the development of more efficient and advanced electric machinery. Additionally, government initiatives and incentives aimed at promoting sustainable practices further accelerate the transition towards electric construction equipment, creating a conducive environment for market growth.

Challenges – Electric Construction Equipment Market  

Heavyweight of batteries increases the overall weight of electric construction equipment, impacting mobility and efficiency.

The added weight of batteries increases the overall mass of electric construction machinery, which can impede mobility and maneuverability on job sites, particularly in tight or rugged terrain. This limitation reduces the flexibility and agility of electric equipment compared to their traditional counterparts, potentially hindering productivity and project timelines. The increased weight necessitates stronger structural components and chassis designs to support the machinery, leading to higher manufacturing costs and pricing barriers for potential buyers. Additionally, transporting heavier electric construction equipment requires specialized transport vehicles and infrastructure, adding logistical complexities and expenses for construction companies. Moreover, the added weight contributes to increased energy consumption during operation, reducing the overall efficiency and operational duration of electric machinery. Furthermore, heavy batteries may require more frequent recharging, leading to downtime and interruptions in construction activities. Addressing these challenges requires innovative solutions to optimize battery efficiency, reduce overall weight, and enhance the performance and usability of electric construction equipment.

Market Landscape

Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the Electric Construction Equipment Market. in 2023, The major players in the Electric Construction Equipment Market are Caterpillar, Komatsu Ltd., AB Volvo, Deere & Company, Escorts Kubota Limited, Hitachi Construction Machinery Co., Ltd., J C Bamford Excavators Ltd., Kobelco Construction Machinery Co., Ltd., Liebherr-International AG, Manitou BF and Others.

Developments:

 In April 2024, LiuGong introduced new electric equipment for Europe, including excavators and wheeled loaders, with the 856HE boasting a remarkable 10-12 hours of operation on a single charge. With ambitions to secure a top-ten position in Europe's construction equipment market by 2027, LiuGong offers a diverse range of 40 electric models, spanning excavators, loaders, graders, rollers, and trucks.

 In December 2023, Ferronordic, a European-based dealer of Volvo Construction Equipment, Trucks, and Renault Trucks, enters the US market through the acquisition of Rudd Equipment, consolidating Volvo CE dealership in Kentucky, Ohio, and Indiana. With 100% stock acquisition, Ferronordic aims for strategic expansion and synergy, poised for further growth in North America.

 In May 2022, JCB launched the industry's first fully electric excavator, the JCB 19C-1E, in India at Excon Bengaluru, as part of their sustainability initiative. Additionally, they introduced a range of other innovative products including a natural gas-powered genset, emphasizing their commitment to reducing emissions and supporting infrastructure development.

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