Compact Utility Vehicles Market

What is the Future Outlook on Compact Utility Vehicles Market in Comparison to Historic Sales?

Facing challenges such as high fuel consumption, low performance, and high cost has always been one of the prime concerns of end users. Choosing a correct compact utility vehicle for specific application has been difficult for end users, hence manufacturers have increased the number of in-built attachments and features in-built to fulfil customer requirements.

The market is likely to gain significantly from the launch of electric compact utility vehicles in the near future. This will not only help automakers tackle soaring environmental concerns but also offer consumers added benefits. Some of the leading compact utility vehicle manufacturers already have launched electric compact utility vehicles in the market and several others are likely to follow the suit to keep pace with dynamic environment.

Compact utility vehicle have been consistently employed for digging, drilling and boring, and other usage. Owing to the ongoing crisis caused by COVID-19 pandemic, the production and supply chain activities have seen a minor slump yet the consumption will improve with the economic recovery post the containment period following the pandemic.

The COVID-19 pandemic has caused severe impact on the global economy at various levels and the impact is seen on off-road vehicle industry as well. The compact utility vehicle market growth is also projected to be affected by the COVID-19 pandemic crisis and is expected to witness a significant plunge in demand in 2020. With a number of end users affected in regions like North America, East Asia and Asia-Pacific, the supply and shortage in demand are expected to result in a significant drop in Y-O-Y growth yet FMI expects global compact utility vehicle market to grow at 2.4 % CAGR through 2031.

What is the Commercial Potential of Compact Utility Vehicle?

Compact utility vehicles are mostly used in the construction industry for different applications including drilling, digging, breaking, demolition, grapping, and others. Being of compact size, they can be used when more no of obstacles are present on the ongoing project. Also, compact utility vehicles require less fuel compared to big sized off-road vehicles add as one the most sophisticated feature of the compact utility vehicles.

Leading manufacturers are investing more on research and development activities of diesel and electric compact utility vehicles, especially in electric compact utility vehicles segment. Competitive price offering, increase in end user satisfaction on the performance, use of advanced technologies are the end results of the R&D activities. Increasing research and development activities through collaboration or partnerships helps the company for launching new and innovative products in the market

Moreover, establishing sales and service facilities in emerging countries coupled with long term partnerships with regional distributors also paves the way for the expansion of channel reach.

What is the Regulatory Impact on Compact Utility Vehicle Sales?

In certain regions, the construction equipment industry faces challenges of strict legislation to attain certain standards of construction equipment. The governments create agency to protect the environment such as Pollution Control Agency, Environmental Protection Agency, Kano State Environmental Planning and Protection Agency, and many more. This regulation require manufacturers to invest heavily in new technologies but at the same time, the manufacturer of construction equipment faces low sales in terms of volume. Henceforth, this factors are pulling the global compact utility vehicle market.

Country-wise Insights

What % of Compact Utility Vehicle Sales will be Concentrated in US?

FMI has projected US to remain one of the most lucrative markets throughout the course of the forecast period. One of the key factors supporting enhancement is the growth in industrial use and for civic utilities applications in the country.

As U.S. is one of the biggest construction market, after the end of recession construction projects in the U.S has accelerated and expected to increase the total sales of compact utility vehicles in the forecast period.

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Attributing to these factors the U.S. remains one of the largest markets for compact utility vehicle in the world, which invariably makes it a lucrative pocket for manufacturers.

Will Germany’s Strong Automotive Market Boost Prospects?

Being the largest shareholder in Europe, the Germany compact utility vehicle market is pegged to grow with 1.7% of growth rate during the period 2021-2031. In recent years, manufacturers are gradually developing new customer base in the Germany.

As German construction segment is rising considerably, growth in the German compact utility vehicle market is pegged to grow at y-o-y of 1.4%. Key macro-economic drivers of the country remain robust and many factors are favorable for growth, which is expected to provide stable forecast during the forecast period.

Gardening and landscape applications have increased significantly in German market and is pegged to impact the global compact utility vehicle market as well. Also, rental sales in Germany have increased considerably, impacting the demand of new compact utility vehicles.

What’s the Outlook on India Compact Utility Vehicle Market?

Indian compact utility vehicle market is the second largest in the South Asia & Pacific compact utility vehicle market. Excavator in the range of (20-50 HP) has emerged as a key segment in the Indian compact utility vehicle market. India is pegged to grow with a CAGR of 3.8% during 2021-2031, which is highest growth rate in the South Asia & Pacific compact utility vehicle market.

Increased construction activities and civic utilities applications in India is leading to increase demand for compact utility vehicles, which has led to promising growth forecast for the market during 2021-2031 period.

Wil Brexit Weaken Demand in UK’s Automotive Sector?

Brexit scenario is impacting the manufacturers and consumers in the UK compact utility vehicle market. Infrastructure development activities in U.K to remain tight, part for the compact utility vehicle market. Strengthening environmental regulations in the UK is projected to grow electric compact utility vehicle segment in the forecast period.

In the historic period of 2018-2019 excavators have seen stronger sales compared to other off-road vehicles.

In U.K., the ratio of new end user to rental sales have been (60-40%) or (65-35%) range. Increasing acceptance of tracked compact utility vehicles in UK is expected to drive global market for tracked compact utility vehicle market.

Is China a Lucrative Market for Compact Utility Vehicle Manufacturers?

The Chinese compact utility vehicle market is expected to present most significant country market in terms of new opportunities, following the U.S., for future sales of compact utility vehicles, owing to increased civic utilities and construction activities in the country. There has been extraordinary surge in sales of compact utility vehicles in China between and 2019, and this trend is expected to continue the forecast period 2021-2031

Category-wise Insights

How Big is the Rental Space in Compact Utility Vehicle Market?

New buying as well as rentals continue to create opportunities for compact utility vehicles. Rental sales continue to be a lucrative channel for compact utility vehicle manufacturers. Ratio between direct end user sales varies from metropolitan to peripheral regions. Government construction projects, which largely make use of rented machinery, remain a key avenue for manufacturers. Companies such as Sunbeltrentals, Kanamoto Co., Ltd., and Rentaga are offering rental compact utility vehicles of different manufacturers.

Which is the Preferred Compact Utility Vehicle Platform?

The demand of different platforms varies from region to region, as In APAC and Middle East, wheeled type platforms expected to contribute significant share in the global compact utility vehicle market. Demand of tracked type of platforms in Europe and North America is expected to boost in the forecast period with substantial growth in 2021-2031 forecast period. Tracked vehicles are having more advantage of working in difficult terrain, compared to wheeled one. Still, wheeled type of platform is expected to hold largest market share during forecast period due to slow adoption rate of tracked type platform vehicles.

What is the Market Share of Skid Steer Loaders?

Excavator sales were predominant in comparison with skid steer loader sales during 2015-2019 and are expected to remain so during the forecast period 2021-2031. Skid steer loader expected to grow at a CAGR of 1.9% through 2021-2031. Skid steers are mostly used in small-scale projects and residential applications. Skid steers are ideal in use when the material is stacked up and require tricky turns.

Excavators hold more than 70% of market share compared to skid steer loader and detachable based vehicles. The most prominent process for which construction equipment’s are used is the excavation. Excavators are used on higher priority while excavation is being done on construction sites. Ability of extended reach about excavators on the construction site makes use of excavator more flexible in use hence skid steer loader are expected to hold low market share compared with excavator in the global compact utility vehicle market.

Which Power Segment Compact Utility Vehicles are Preferred?

Globally, 25-50 compact utility vehicles remain preferred by end-users. This segment holds over 90% share of the market, and is set to grow at 2.6% CAGR during the forecast period. Owing to more no of product variants and specifications in the range of 25-50 HP segment, consumers continue to have a wider flexibility in this segment.

Where are Compact Utility Vehicles Mostly Used?

Construction industry accounts for the bulk of demand for compact utility vehicles globally. Demand is especially high in the small-scale industry segment. Civic utilities is another lucrative segment, where these vehicles are used for civic projects such as solid waste management and small scale infrastructure projects.

Why Diesel Compact Utility Vehicle Hold Higher Share?

Diesel compact utility vehicles account for over 90% of the overall share through the forecast period. Sales of electric compact utility vehicles is expected to increase at low pace, as product refinement and development activities are going on in this segment and there is potential for great improvement. Many manufacturers have launched their own electric compact utility vehicles but for adoption of electric vehicles in the compact utility vehicle market it will take a few more years to compete significantly with diesel type.

Competitive Landscape       

The compact utility vehicle market is moderately competitive, with presence of large number of players offering cost-competitive products. Some of the players are focusing to carve a niche for specific demography. The market has robust partnerships throughout the value chain, with high focus on innovations. Manufacturers are aiming at strategic collaborations with end users and regional distributors to address the requirements of an expanding customer base. Suppliers adopt acquisition and regional expansion strategies to establish a foothold. Brand consciousness and aggressive marketing makes it challenging for new entrants in this market. Through these developments, companies are aiming at competitive advantage. Furthermore, advent of online sales channel is also expected to create positive growth prospects for the growth in demand for these vehicles.

For instance,

• Hitachi Construction Machinery Tierra developed a battery-powered mini excavator prototype. The current prototype was developed by Hitachi Construction Machinery Tierra Co., Ltd., in cooperation with the European Application Center GmbH.
• Wacker Neuson Group launched the electric mini-excavator EZ17e. With the mini-excavator EZ17e, The Company has expanded its zero emission series of mini excavators.
• Komatsu introduced new PC80MR-5 mini excavator. The PC80MR-5 is designed for improved versatility, maneuverability, comfort - and for low operating costs.
• Volvo Construction Equipment revealed two zero emission machines at the Bauma trade fair in Munich, namely electric compact excavator ECR25 and compact wheel loader L25.

Some of the leading companies operating in the market are:

• Kubota Corporation
• Komatsu Ltd.
• Hitachi Construction Machinery Co. Ltd.
• Doosan Bobcat
• Hyundai Construction Equipment Co., Ltd.
• CNH Industrial America LLC
• YANMAR HOLDINGS CO., LTD.
• Mitsubishi Logisnext Co., Ltd.
• Volvo Construction Equipment
• Caterpillar

*The list is not exhaustive, and only for representational purposes. Full competitive intelligence with SWOT analysis available in the report.

Scope of the Report

Key Questions Answered in the Report

Q1. Which is the most lucrative market for Compact Utility Vehicles?

U.S currently leads the global market for Compact Utility Vehicle. Sales in U.S will be over 15% of total demand throughout the forecast period.

Q2. Which are the top-selling Compact Utility Vehicles?

Excavators are highly sought-after for many applications. The demand for excavators is expected to remain high in the near future, especially due to its intense penetration in all regions.

Q3. Which is the most lucrative application for compact utility vehicles?

Compact utility vehicle are widely used in construction applications. Their usage in demolition, construction of buildings and roads is rising day-by-day.

Q4. Which are some of the leading compact utility vehicle manufacturers?

Some of the leading companies manufacturing Compact Utility Vehicle are Kubota Corporation, Doosan Bobcat, Komatsu Ltd, Hitachi Construction Machinery Co. Ltd., Hyundai Construction Equipment Co., Ltd., etc.

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Key Segments

By Vehicle Type

• Skid Steer Loaders
• Excavators
• Detachable Accessory Based Vehicles
  • Power Auger
  • Hydraulic Breaker
  • Diggers
  • Dumpers
  • Others

By Platform

• Tracked
  • Wide
  • Narrow
• Wheeled

By Operation Type

• Diesel
• Electric

By Rated Power

• 20 to 25 HP
• 25 to 50 HP

By Applications

• Construction
• Gardening & Landscaping
• Civic Utilities
• Industrial

By Sales Channel

• Direct End User
• Rental

By Region

• North America
• Latin America
• Europe
• East Asia
• South Asia & Pacific