Report

The Spain compact construction equipment market is expected to grow at a CAGR of 5.12% from 2022-2029.

KEY HIGHLIGHTS

- Compact forklifts accounted for the largest market share of the Spain compact construction equipment market in 2022. Application of compact construction equipment in the material handling segment accounted for the largest share in 2022. Rising investment in housing, warehouse expansion, and public infrastructure projects is expected to drive the demand for compact excavators in the Spain compact construction equipment market.
- The joint venture of Kronos Real Estate Group and Nuveen Real Estate has assigned Dragados to construct the project in a build-to-rent format, which will house around 1,000 tenants. The work on the 531-home residential development has begun in Madrid and is scheduled to be completed in 2025.
- Another project, the Caixa Forum Madrid, is a brownfield development transforming Mediodia Power Station into the new headquarters of the Caixa Forum in Madrid. It will encompass an area of 10,000m2; however, it will have the same appearance as the previous. The facility will comprise seven floors: house offices, a restaurant, showrooms, a 300-seat auditorium, conservation workshops, and a warehouse.
- Approvals for new office construction projects in Spain have increased significantly in 2023. Among the recent deliveries, 'Alaba 111' in Barcelona, owned by Blackstone, is one of the critical projects. Alaba 111 is a smart office building of 18,300 square meters, which is Wired Scored and has been LEED Gold certified.
- BP p.l.c. in Feb 2023 launched the green hydrogen cluster of the Valencia region (HyVal) at its Castellon refinery. The development will include 2 GW of electrolysis capacity by 2030 for producing green hydrogen at BP's refinery. The project will support the decarbonization of the refinery's operations, replacing its current use of 'grey' hydrogen.

SEGMENTATION ANALYSIS

Segmentation by Type

- Excavators
- Backhoe Loaders
- Wheeled Loaders
- Track Loaders
- Skid Steer Loaders
- Telehandlers
- Forklifts
- Aerial Platforms
- Others (Articulated Loaders, Truck Carriers)

Segmentation by Application

- Material Handling
- Maintenance & Utility Works
- Waste Management
- Other Applications

Segmentation by End Users

- Construction
- Mining
- Warehouse & Logistics
- Other (Power Generation, Utilities Municipal Corporations, Oil & Gas, Cargo Handling, Power Generation Plants)

MARKET TRENDS & DRIVERS

Increased Investment in Hydrogen Fuel Networks to Support the Spain Compact Construction Equipment Market

- The Hydrogen Roadmap of Spain lays down national targets for 2030 and 2050, where the country believes in achieving climate neutrality and having a 100% renewable energy system. The government has announced its plans to increase production (10 million tonnes) and green hydrogen consumption (20 million tonnes) by 2030.
- The 'European Strategy' has also laid out three phases of renewable hydrogen development. The first phase (2020-2024) is planned to have at least 6 gigawatts of electrolyzers installed in the EU and up to one million tons of renewable hydrogen production.

Increased Investment in Water And Solid Waste Management Activities Across the Country to Support the Demand for Compact Material Handling Equipment

- In March 2023, Smurfit Kappa announced investing USD 28.7 million into a new waste management and recovery facility at its Nervion paper mill, where a lime kiln and gas treatment system expected to divert 75,000 tonnes of waste from landfills.
- In June 2023, Madrid-based Sacyr S.A. sold its Valoriza Servicios Medioambientales (VSM) waste and recycling services business unit to the New York-based Morgan Stanley Infrastructure Partners.
- EnergyLOOP, in Jan 2023, announced the installation of its innovative blade recycling plant in Spain. The company will begin construction of the facility in August 2023, which is scheduled to operate from 2024. The company will also contribute to developing an innovative value chain with an investment of approximately USD 10 million and creating more than 100 jobs.

Integration of Technological Solutions in the Spain Compact Construction Equipment Market

- Caterpillar's new D series skid steer loaders are integrated with the Cat Intelligent Leveling (ILEV) system, which provides several industry-smart features, including dual self-leveling, electronic snubbing, return-to-dig, and work tool positioning. Moreover, this new series model is equipped with the necessary emission control standards provided by the government.
- The digitization of construction equipment through advanced sensors, communication technology, and data analytics has revolutionized construction equipment. Real-time data collection enables predictive maintenance, minimizes downtime, and extends equipment lifespan. AI-integrated equipment improves efficiency, delivers quality, enhances supply chain management, and reduces risks.

Increased Public Infrastructure Investment to Propel the Demand for Compact Construction Equipment

- The European Funds has planned to contribute approximately USD 2.1 billion in Spain until 2027. The Recovery and Resilience Mechanism (MRR) has significantly pushed infrastructure investment. The plan also supports the green transition through investments of over USD 8.3 billion in the energy efficiency of public and private buildings, including new social housing.
- The high-speed network is expanding, with the new Madrid-Murcia and Madrid-Burgos sections announced in 2022 and the inauguration of the Madrid-Asturias line scheduled for 2023. The Spanish Government has estimated that between 2025 and 2026, the construction of the entire corridor from Almeria to the French border will be completed.

Increased Investments in Green Energy Projects Across the Country to Propel the Sales of Compact Construction Equipment in the Spain Compact Construction Equipment Market

- Of 490 projects, 24 have achieved the Administrative Authorization for Construction (AAC) for the power of 1,948.32 MW. 19 installations are photovoltaic, three are wind, and two are hybridized sites.
- With the Spanish energy market's largest capacity, Iberdrola is developing three projects for 399 MW of capacity. These are "Tagus" and "Casetona" photovoltaic energy sites, with 329.9 MW and 27.675 MW of power, respectively, and a hybrid with wind energy site called "Ballestas" with 41.58 MW.
- The MRR Plan includes a?law on climate change and energy transition?, which aims at renewable targets for 2030 and asserts that climate neutrality will be attained by 2050, including a 100% renewable electricity system.

INDUSTRY RESTRAINTS

Skilled Labor Shortage to Hamper Construction Activities in the Region

- A survey conducted by the Bank concluded that 62% of the companies in the hospitality sector have various difficulties in retaining the staff required to maintain and boost their businesses, and the construction market was recorded with 49% of the companies facing the same issues.
- The aging population is another reason for the shortage. In 2012, the population aged 65 and over accounted for 17.4%; by 2022, it will have already exceeded 20%. In contrast, the population under 20 fell to 19.2% in 2022, after years of stagnation at around 20%.

High-Interest Rates to Restrict the Growth of the Housing Sector

The Spanish residential market is slowing down, with several factors contributing to reduced demand for property. Rising interest rates, tighter credit conditions, global economic uncertainties, and geopolitical instability have dampened housing demand. According to the National Bank of Spain, affordability has declined significantly over the past year (2022). At the beginning of 2022, households only needed to spend 30% of their income to repay loans, but by the fourth quarter, this percentage had escalated to more than 36%. Interest rates rose further in the first half of 2023, likely degrading housing affordability.

Surge in Input Prices and Difficult Market Situations Increase the Overall Construction Cost in the Market

Since Jan 2021, Spain's construction cost index has escalated sharply, predominantly driven by the strong global demand recovery and the war crises in Ukraine. The prices of energy-intensive building materials, such as concrete, cement, and bricks, have continued to increase despite declining energy prices. Moreover, in the coming years, the Spanish construction and real estate sector will be significantly affected by stringent regulations on the energy efficiency of buildings. The construction companies must meet higher sustainability and energy efficiency standards at each stage of the project's lifecycle. Therefore, these mandatory regulations may also escalate the cost of new construction projects.

VENDOR LANDSCAPE

- Caterpillar, Volvo CE, Komatsu, JCB, Kubota, and Hitachi Construction Machinery are front runners in the Spain compact construction equipment market. These companies have strong market share and offer diverse sets of compact equipment.

Prominent Vendors

- Caterpillar
- Komatsu
- Volvo Construction Equipment
- Hitachi Construction Machinery
- JCB
- SANY
- Xuzhou Construction Machinery Group Co. Ltd. (XCMG)
- Kubota
- Kobelco
- Hyundai Construction Equipment
- Takeuchi
- CNH Industrial

Other Prominent Vendors

- LiuGong
- Bobcat
- Liebherr
- Manitou
- Wacker Neuson
- Yanmar
- MERLO Group
- Mecalac
- Toyota Material Handling
- Develon
- DIECI Srl
- AUSA
- VF VENIERI Spa
- Hinowa S.p.A.
- Eurocomach
- Kalmar
- Haulotte

Distributor Profiles

- Centrocar
- Aurteneche Maquinaria
- SUR KOMAT Maquinaria S.L.
- Finanzauto
- Opein
- Huppenkothen
- ITT BobcatOf
- WALKIA

KEY QUESTIONS ANSWERED:

1. How big is the Spain compact construction equipment market?
2. What is the growth rate of the Spain compact construction equipment market?
3. Who are the key players in the Spain compact construction equipment market?
4. What are the trends in the Spain compact construction equipment market?
5. Which are the major distributor companies in the Spain compact construction equipment market?