Construction equipment production in North America and Europe, the Middle East and Africa is expected to return to stronger growth in 2027 following a difficult period for the global off-highway market, according to new research from Interact Analysis.
After a downturn in 2025 and moderate growth forecast for 2026, construction vehicle production is projected to increase by 13% in North America and 9% across EMEA in 2027.
The outlook is less positive in Asia-Pacific. Interact Analysis expects construction vehicle production in China to contract by approximately 9% in 2027, while the rest of APAC is forecast to decline by around 3%.
China’s construction equipment market is not expected to fully recover during the forecast period, with production projected to fall from 474,000 units in 2026 to 455,000 in 2030. Interact Analysis attributes the weaker outlook primarily to subdued private-sector investment linked to policy uncertainty and slower manufacturing growth.
Electrification is also beginning to reshape parts of the construction equipment market. While battery-electric technology remains heavily concentrated in material handling, Interact Analysis identifies compact urban construction equipment in Western markets and larger machines in China as emerging areas for battery-electric adoption.
“BEV’s relevance is bimodal and concentrated overwhelmingly in material handling at present,” said Chloe Mason, Market Analyst at Interact Analysis. “Our research indicates the only currently meaningful growth frontiers are compact urban construction in the West and large machines in China.”
Smaller equipment continues to dominate the wider off-highway market, although the research identifies the 36–100 kW category as an area with potential for greater electrification later in the decade.
