In the long term, market growth for the off-highway vehicle sector looks set to remain positive due to strong investment in warehousing solutions, India’s pledge to mechanize agriculture, and the US’s investment in infrastructure. In the short term, the extended lockdown period in China has had an unprecedented downward impact on market growth within the APAC region, while ongoing freight delays and component shortages have impacted the ability of manufacturers to meet demand. In 2022, OEMs experienced very strong order intakes, but due to supply chain disruptions were unable to fully meet market demand, thereby restricting growth.
The Chinese market performed worse than the forecast by Interact Analysis back in 2021, due to the country’s strict Covid policies. Nevertheless, as the country represents the largest market for off-highway machinery, it is expected to bounce back in the coming years. This has led Interact Analysis to be more bullish with their forecasts for global electrification.
Electrification – and other alternative fuels - within the off-highway market is now well established. Almost all machine manufacturers have at least one or several battery electric, or hydrogen models available for purchase or in the pipeline. Although hydrogen powertrains are becoming established in some material handling applications and in larger equipment, it is the battery electric powertrains that are forecast to dominate in the long term.
The off-highway machinery market bounced back well from the pandemic and growth forecasts remain positive out to 2027.
Alastair Hayfield, Senior Research Director at Interact Analysis, comments: “It’s promising to see that even some of the larger machinery types such as excavators and haul trucks are being electrified. Smaller machinery electrification has paved the way for this, enabling OEMs to experiment before moving on to larger, and more complex machinery.”
He adds, “Interact Analysis is more bullish on the demand for electric machinery versus its previous research. In the years to come we can expect to see huge developments made toward electrification within the compact machinery market, particularly in Western Europe and China. The Netherlands, for example, is showing very positive signs for off-highway machinery electrification, with an uptick in government funding and city bans on polluting vehicles.”
This is the 3rd edition of the well-respected Interact Analysis market report providing insight and analysis into the global off-highway vehicles industry, including vehicle powertrain forecast.