Factory closures and national lockdowns around the world will cost the global construction equipment industry lost production of 43,000 machines this year, according to specialist market research and forecasting company Off-Highway Research. This is equivalent to 4% of last year’s total output of 1.07 million machines.
At present the most significant impacts of closures are being felt in France, Germany, Italy and the UK, Europe’s largest equipment producing countries. However, Off-Highway Research also highlights the experience of China, where the industry is now trying to make up for lost time.
Off-Highway Research managing director Chris Sleight said, “Factory closures and lockdowns in China cost the industry 6% of its production. Some OEMs didn’t close at all, but most were shuttered for two-six weeks and then had to ramp up production once they re-opened. Activity is now very high as the industry is anticipating some government stimulus and something of a buying spree.”
Prior to the COVID-19 pandemic, Off-Highway Research was forecasting a softening of global demand for equipment.
According to Sleight, “The industry reached a peak in 2018 and 2019, and we were already expecting a decline of 5% or so this year from those record highs. COVID-19 will most likely exacerbate that, but we also expect a strong policy response from governments around the world to reinvigorate their economies. It is too early to put a figure on what the impacts will be.
“As disruptive as the closures and lockdowns are at the moment, I don’t think lost production and supply chain difficulties will be the industry’s main problem this year. The biggest challenge will be adapting to demand in the second half of the year. That will be volatile and most likely lower than the industry has enjoyed in the last two years.”
The results from Off-Highway Research’s survey of lost equipment production in 26 countries around the world is available to clients now via conference calls. Contact firstname.lastname@example.org if you would like to arrange a call. Results will also be published in a special complementary report in May which will be available to ALL clients.