Market Trends of Asia-Pacific Hydraulic Equipment Industry
This section covers the major market trends shaping the APAC Hydraulic Equipment Market according to our research experts:
Construction Sector Will Experience Significant Growth and Drive the Market
- Asia Pacific region as a whole is united in experiencing substantial economic and population growth, which is expected to continue over the years and fuel the infrastructure development. According to the Asia Development Bank report, total infrastructure needs in the region will grow from USD 2.8 trillion (baseline estimate) to USD 3.1 trillion (climate-adjusted estimate). So, the total annual investment will range from USD 184 billion to USD 210 billion that would be utilized for large scale projects involving energy, road, rail, water, and other infrastructure. It is expected to drive the demand for hydraulic equipment in the construction sector.
- For instance, the Chinese government’s infrastructure spending grew by 3-5% in 2019, which includes USD 120 billion in railway construction and USD 270 billion in road and waterway projects. Moreover, sales of mobile crane trucks in the first half of 2019 was almost 40-50% higher, compared to the last year. One of the biggest Chinese company, Sany Heavy Industry, whose turnover grew 46% in 2018, has now become the sixth-largest equipment manufacturer in the world.
- Additionally, the infrastructure in India is also developing at an unprecedented rate; hence, the studied market vendors are also trying to utilize these opportunities. For instance, the Indian government plans to invest close to USD 1.4 trillion to build modern ports, highways, railways, airports, hospitals, and educational institutions to give a significant boost to the Indian economy. Big companies like Volvo are collaborating with government organizations. Domestic players, Bonfiglioli Transmissions, are also expanding their manufacturing facility to double the production in India.
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Automobile Sector Will Experience Significant Growth and Drive the Market
- Automotive is another sector where hydraulic equipment, like pumps, are finding massive applications, like in energy generation to run the vehicles. And with the recent trend of Electric Vehicle (EV) and the growing adoption of robots in automotive manufacturing, the studied market scope is further expanding. Although China was one of the major manufacturers, however, the recent US-China trade war and COVID-19 outbreak are forcing many manufacturing companies, including automotive, to shift to other South Asian countries like India and Vietnam.
- Additionally, in December 2019, Gates launched a new hydraulic hose, MXG 4K, in the Indian market. According to the company, it is the next generation of premium hydraulic offerings that provides a highly flexible, lightweight, and compact design for the first fit, industrial, and automotive sector.
- Moreover, the smart factory adoption rate is highest in the automotive industry which is set to increase investment by over 60% in the next three years in order to gain productivity up to USD 167 billion. According to the report, 3 out of 10 automotive factories have been made smart in the past 1.5 to 2 years. For instance, Bosch invested EUR 31 million in an Indian plant that features the latest industry 4.0 solutions. It is expected to drive the automotive sector in Asian countries and will in turn fuel the hydraulic equipment market in the region.
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