The use of large excavators and the introduction of hydrogen fuel technology is gaining traction
Dublin, Aug. 3, 2022 (GLOBE NEWSWIRE) — The “Sweden Market for construction machinery – Strategic assessment and forecast 2022-2028” the report has been added ResearchAndMarkets.com’s offer.
Around 35,000 units of construction machinery are expected to be sold by 2028 in Sweden. Growth in construction equipment is mainly driven by government investment in public infrastructure, road construction and a focus on renewable energy projects.
Investments under the National Transport Development Plan to cover investments for the renovation and modernization of existing infrastructure
The Swedish economy has made a strong recovery from a 2.9% decline in 2020 to a growth of 4.8% in 2021. Swedish economic growth is hampered somewhat by the war between Russia and Ukraine, which negatively affects the country’s exports. The country’s inflation is expected to rise in 2022, affecting economic growth.
However, the Swedish economy is resilient due to significant government investments in public welfare, improved labor market conditions and investments in the development of the transport industry. According to the Swedish government, the Swedish economy is expected to grow by 3.1% in 2022.
In 2021, the Swedish government’s national transport development plan allocated 86.9 billion dollars in funds for 12 years. The plan also includes investments of $71.2 billion for new construction, renovation and modernization of existing infrastructure. The government also planned to triple mining production by 2025. Growth in the construction and mining industry is expected to positively affect the demand for construction equipment in Sweden.
Sweden was ranked 10th in the ease of doing business index among 190 countries in 2019 compared to 12th in 2018. It has complete information and communication technology (ICT) and industrial internet sectors and can collaborate effectively between industries, academia and government, which makes it an attractive market for new technology. Stockholm, Uppsala and Öster Gotland are the big cities that accounted for ~66% of total GDP in 2021.
In 2021, the government eased the norms for foreign investment in the construction, transport and renewable energy sectors. Sweden has a solid and successful manufacturing/industrial technology sector that accounts for approximately 20% of the country’s GDP. Services and manufacturing accounted for more than 50% of FDI inflows in 2021.
In Sweden, there are large infrastructure projects such as Stockholm Arlanda Airport ($200 million), North Bothnia railway ($2.9 billion), double track between Ängelholm & the Helsingborg region ($200 million), Olskroken Project ($400 million), Onshore Wind Farm Markbygden Vind AB, the Bypass Project Stockholm ($3.7 billion), and highway construction between the intersection Ronneby Öst and Nattraby is underway in 2022.
Growth in investment in public infrastructure and the mining sector
In 2021, the government proposed under the transport development plan to maintain, expand and develop the Swedish transport infrastructure over the next twelve years with an investment of 89.6 billion dollars. The government has established a national plan for infrastructure for the years 2018-2029. The government planned to invest in developing the airport, rail lines, roads and bridges across the country’s major cities by 2021.
There was an increase in the demand for minerals and metals in the global market in 2021 after the pandemic due to increased economic activities. Sweden’s government aims to triple mineral production by 2025; the country’s mining industry experienced growth following high market demand for minerals. The country has a huge potential for iron ore production based on exploration data. So the government focused on increasing iron production until 2025. Growth in the mining industry is expected to support demand for large excavators, wheel loaders and cranes in Sweden’s construction machinery market.
Strong growth in the oil and gas industry and investments in solar energy projects
In 2021, Sweden aimed to produce 100% of its electricity from renewable energy resources by 2040. Sweden’s wind power capacity was 12.8 GW in 2020, and the wind power sector’s capacity grew by 2.7 GW in 2021 following the addition of new wind power plants. The government aims for 17 GW of cumulative installed wind power by 2024.
By 2022, 58 onshore and offshore wind projects are planned for the next five years, with a total project value of $25 billion. For example, the onshore wind farm Markbygden Vind AB, with a total capacity of 4,061 MW in northern Sweden. Other offshore wind farms Kriegers Flak (Sweden) Baltic Sea between Sweden and Germany, with a capacity of up to 640MW, planned by the government in 2022.
The strong growth of the construction rental market and the government’s poor housing system are major limitations for construction equipment on the Swedish market.
With the increased infrastructure development across Sweden, the demand for rental equipment has increased since 2019. In 2021, a further investment was made in rental equipment to eliminate costs for new equipment. In Sweden’s construction market, construction & remodeling projects are growth engines for the rental of construction machinery. Demand for rental equipment increased in construction projects for commercial, office and healthcare buildings in 2021.
According to Rental Company DKLBC (Danderyd-Kedjan Lastbilcentalen), CEO Per Geber, the rental business for construction machinery is growing by ~40% in Sweden. The rental equipment is in great demand from broad customer groups such as significant construction companies, machine contractors & private individuals. The rented plant equipment solves the customer’s needs at short notice and is cost-effective. The increased demand for rental equipment on the Swedish market may inhibit the growth of sales of new construction equipment during the forecast period.
Sweden has been facing severe housing shortage since 2017. The Swedish government follows old & rigid policy to control the rent which negatively affected the construction of new houses for rent due to the low profit margin for the house owners & builders. The strict rent controls discourage developers from building and renting out vacant properties. The government is also raising mortgage taxes, which is hampering the country’s housing market.
In 2021, demand for housing decreased due to an increase in central bank interest rates, resulting in an increase in inflation, which hampered consumer purchasing power. According to government data, 70% of Sweden’s municipalities will face a serious housing shortage in 2021. The poor housing system and increased taxes are expected to negatively affect the demand for housing deals in 2022.
Use of large excavators and introduction of hydrogen fuel technology is a new trend in the Swedish market
Sweden has a large reserve for cobalt, phosphate and graphite. Various mineral extraction projects in the Lovisa mine, Zink mine and Aitik mines are ongoing.
Demand for large excavators with high lifting capacity increased in 2021; the country’s largest OEM Volvo construction machinery launched the EC950F large excavator with a high lifting capacity of 34 tons. With the increased mining activity in Sweden, other OEMs such as Caterpillar, Hitachi and Komatsu are expected to shift their focus to developing large, flexible excavators with high lifting capacity for the Swedish market.
Green hydrogen fuel cell technology uses clean energy resources to produce hydrogen fuel cells that are used to power the construction equipment. Demand for green hydrogen fuel technology is expected to grow among heavier equipment due to its environmental benefits.
Volvo Construction Equipment introduced a hydrogen fuel cell test lab in 2021. The company launched green hydrogen fuel technology in 2021, which is expected to be used in newly launched equipment on the Swedish market. The technology supports Volvo Construction equipment’s goal of becoming a fossil-free manufacturer by 2040.
IMPORTANT HIGHLIGHTS OF THE REPORT
Material handling equipment has the largest share on the Swedish market compared to excavation and road construction equipment. Forklift trucks have the highest share among material handling segments in the Swedish construction machinery market for 2021.
Government investments in road construction, infrastructure development, housing projects, smart cities and focus on renewable energy projects from wind and solar are expected to support the demand for material handling equipment in Sweden’s market during the forecast period.
The government’s National Transport Development Plan and increasing focus on renewable energy projects are key economic drivers for economic recovery and growth in demand for construction equipment in the market. The government investment in solar cell roof panels and wind power projects is expected to support the need for excavators & cranes in the Swedish market.
The demand for electric machines on the Swedish market will increase in 2021. For example, Volvo construction machines launched a new series of electric excavators and loaders on the Swedish market.
Volvo Construction Equipment & Caterpillar are large construction machines on the Swedish market. Volvo Construction Equipment has introduced advanced technology such as automation and green hydrogen according to market requirements in Sweden.
SELLER LANDSCAPE
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Volvo Construction Equipment, Caterpillar, Kubota, Komatsu & Liebherr account for 54% of the market share for construction machinery.
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Volvo Construction equipment accounts for the largest share of the Swedish market. The company has four manufacturing units in the regions of Braas, Eskilstuna, Hallsberg & Gothenburg.
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Prominent suppliers are Volvo Construction Equipment, Caterpillar, Hitachi Construction Equipment, Komatsu, Liebherr, Kubota, JCB, Hyundai Construction Equipment and Kobelco.
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Other prominent suppliers are Liu Gong, Yanmar, Case Construction Equipment & Terex Corporation.
Key suppliers
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Volvo Construction Equipment
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Caterpillar
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Hitachi construction machinery
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Komatsu
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Liebherr
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Kubota
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JCB
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Hyundai construction equipment
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Kobelco
Other prominent suppliers
Distributor Profiles
For more information on this report visit https://www.researchandmarkets.com/r/wxlal8
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