Market for Construction Machinery to Hit Hard Times Before Hitting Pay Dirt in 2011

New York, November 21, 2007 — Plagued by a suffering residential market, increased uncertainty about the economy, and tightening credit, the market for construction machinery will grind gears before powering back up to $26.0 billion by 2011, according to U.S. Market for Construction Machinery Manufacturing, a new report from market research publisher SBI.

The U.S. market grew significantly—nearly doubling in size—between 2002, when it hit bottom at $12.7 billion, and 2006, when the market reached $24.8 billion. However, SBI forecasts the total U.S. market for construction machinery will decline 12% in 2007 to $21.9 billion due to lower demand and higher production costs and an additional 5% to $20.6 billion in 2008.

Sales should resume by 2009, though, at relatively lower rates than those seen in previous years. Growth of 6% to $21.9 billion—in line with the 1997–2006 annual pace—followed by growth of 10% and 8% for 2010 and 2011, respectively, will bring the expected CAGR for the 2006–2011 period in at 1%.

Longer-term commercial construction projects that have some flexibility will likely be scaled down or even canceled as business and industry spending tightens. However, with recent publicity around America’s aging infrastructure, a future upswing in long-term government contracts may counter the drop in residential building.

“In the face of supply and distribution challenges, marketing strategies and tactics that reach core end-users will become increasingly important and may perhaps indicate a need for increased marketing spending or at least a more diverse channel spend,” notes Cathy Minkler, Associate Editor of SBI. “If stability is to be achieved, the construction industry will have its work cut out for it in the coming years.”

U.S. Market for Construction Machinery Manufacturing covers nine main product categories in both heavy construction and light construction equipment including: power cranes, draglines and excavators; mixers and pavers; off-highway trucks, trailers, coal haulers and wagons; tractor shovel loaders; crawler tractors and dozers; and more. It also identifies key market trends and profiles major market players. The report is available from SBI by clicking: http://www.sbireports.com/Construction-Machinery-Equipment-1487870/. It is also available at MarketResearch.com.

About SBI
SBI publishes research reports in the industrial, construction, materials, and consumer goods markets. For more information visit http://www.sbireports.com, or contact Tom Ehart at 240-747-3014, or tehart@marketresearch.com.