After contracting through last year, the construction machinery market, which had been on a roller coaster, is expected to move beyond a recovery to strong growth as investment rises on demand for eco-friendly equipment and new AI technologies. Korean construction machinery companies, which rely heavily on overseas markets, are also preparing to push harder abroad.
According to analyses by the construction machinery industry and market research firms on the 15th, the global construction machinery equipment market is forecast to nearly double (1.94 times), from $242.17 billion in 2025 to $471.25 billion in 2033. Grand View Research, a global market research firm, said the construction machinery equipment market is expected to log a high compound annual growth rate of 8.7% for eight years from this year through 2033.
The construction machinery industry suffered as it posted negative growth in succession through last year. In 2021, when the business cycle peaked on stimulus measures across countries, global equipment unit sales (market size) increased to 1.36 million units, but then fell 5% to 8% each year to 1.17 million units in 2024 and 1.02 million units in 2025.
Korean construction machinery companies, which are highly dependent on overseas markets, were also hit hard. Doosan Bobcat's operating profit in 2024 was 871.4 billion won, down 37.2% from a year earlier, and in the second quarter of last year, operating profit fell 14.8% on-year to 204.2 billion won. HD Hyundai Construction Equipment's operating profit in 2024 also decreased 26% from a year earlier, and through the second quarter of last year, operating profit fell 31.6% on-year.
In the industry, expectations are that the two companies, which began to show a gradual recovery from the second half of last year, will enter a full-fledged rebound phase starting this year. Some analyses also project that global construction machinery equipment unit sales could expand to as many as about 1.3 million units this year.
Choi Jeong-hwan of LS Securities said, "From the year before last through last year, construction machinery companies had a tough time as the high interest rate environment reduced demand in the dwellings market and infrastructure investment, but we expect a recovery this year," adding, "In North America, dealer inventories are being reduced through promotions that began at the end of 2024, and in Europe and emerging regions (India, South America, Africa), they will benefit significantly from increased infrastructure investment and mine development."
Driving this recovery are infrastructure investment and energy and Smart City policies, which are expected to be more active this year, as well as policies in each country that encourage the adoption of sustainability and eco-friendly equipment. Due to the Russia-Ukraine war and other factors, many countries have strong demand for infrastructure reconstruction, and globally there is vigorous pursuit of "Smart City" projects leveraging AI, data, and AI.
The results of Doosan Bobcat and HD Construction Equipment, whose overseas dependence reaches 70% and 80%, respectively, could also improve. With Korea's construction downturn expected to be prolonged, they plan to diversify overseas expansion strategies.
HD Construction Equipment is showing growth in expanding into emerging markets such as Africa and South America, including Ethiopia and Sudan, where there is demand for infrastructure development and gold mining. In the third quarter, sales in Africa jumped 216% from a year earlier. Doosan Bobcat is also continuing growth in the Middle East and Africa, excluding its traditional markets of North America and Europe.
The Internet of Things (IoT) and artificial intelligence (AI)-based solution market in construction is also expected to gradually expand. According to Grand View Research, the construction IoT market is projected to reach $33.04 billion (47.6635 trillion won) by 2030, with a compound annual growth rate of 16.2%.
In construction machinery, IoT enables real-time monitoring and management of equipment, materials, and personnel, increasing net uptime and helping optimize resource use. As the importance of worker safety and regulatory compliance grows, the market is expected to expand further.
Some say R&D investment must increase to capitalize on rising sales in a growing market. Kim Hee-su, head of the eco-friendly power division at the Korea Construction Equipment Research Institute, said, "When new technologies emerge in markets such as Europe and the technology trend shifts, old conventional construction machinery does not sell," adding, "From our standpoint, with more than 70% of sales coming from exports, if we don't follow, we get blocked." Kim added, "As the market hits an inflection point with AI and eco-friendly technology adoption, increasing R&D investment now could bring bigger opportunities."
Industry officials argue that more government support is needed. They say massive funding is required to catch up with the technology of leading global players. An industry official said, "In Korea, when administrations change, existing R&D budgets disappear, and naturally corporations' investment and development stop," adding, "Consistent government support policies are needed."
Meanwhile, Doosan Bobcat recently took part in "CES 2026" in Las Vegas, showcasing AI technologies applicable to construction sites. A Doosan Bobcat official said, "Construction equipment, unlike cars operated in fixed environments such as roads, faces different work environments, so the development difficulty is higher," while noting, "Still, we have a vision for unmanned and electrified equipment, so we are making constant efforts."