Dublin, Nov. 29, 2022 (GLOBE NEWSWIRE) — The “Canada Used Construction Equipment Market – Strategic Assessment & Forecast 2022-2028” report has been added to ResearchAndMarkets.com’s offering.
A surge in government investment in redevelopment, repair, and projects for roads, hospital buildings, and bridges across the country is expected to drive the demand for used excavators in the Canadian market.
The used construction equipment financing market has witnessed growth after the pandemic. According to the president of Komatsu Financial, used equipment lending saw a sharp rise after the 2nd quarter of 2020.
For instance, John Deere provides 90 days of no payment and 0% interest on its certified used construction equipment. After the pandemic, contractors are facing declining cash flows, prompting demand Canada used construction equipment market due to its low price and quick availability.
Government Investment in Infrastructure Projects & Supply Chain
Disruptions of New Equipment
Canada used construction equipment market benefited in 2020 due to supply chain disruption of the new equipment market. In 2021, the Canadian government increased the infrastructure development projects to overcome the negative impact of the pandemic. The government has produced a sustainable recovery which includes investment in green infrastructure (USD 26.9 billion), public transit (USD 28.7 billion), trade & transport (USD 10.1 billion), and social infrastructure (USD 25.3 billion).
In 2022, the government announced the construction of over 10,000 new housing units by allocating USD 2.5 billion in a fund under Rapid Housing Initiative (RHI). These housing units will help vulnerable Canadians who are at risk of homelessness. The government also planned to invest in green mining technology & renewable energy projects to become carbon neutral by 2050. In addition, USD 1.4 billion is directed to building electric vehicle charging infrastructure.
The Earthmoving segment has the largest share in Canada’s used construction equipment market. Other segments, including motor graders, skid loaders, bulldozers & trenchers, held the largest share in the earthmoving segment in 2021.
The Canadian government’s affordable housing scheme will drive the real estate industry in 2022. Under the rapid housing initiative scheme, the government will focus on building homes for the homeless within a year. Canada used construction equipment market is expected to benefit from it due to its quick availability as housing projects under Rapid Housing Initiative (RHI) are planned to complete in a short interval of time.
The demand for an aerial platform is expected to grow significantly due to various housing projects in 2022. The demand for used construction equipment such as mini excavators, cranes, and multi-terrain loaders is likely to increase due to its extensive use for installing solar, wind & hydroelectric projects.
A surge in investment for transit development & renewable energy projects will be witnessed majorly in Ontario, Alberta, British Colombia & Quebec provinces of the country in 2022. Major infrastructure projects such as Hurontario LRT, Green Line LRT, & Reseau Express Metropolitan are under progress in Ontario, Alberta, & Quebec, respectively.
Recovery in the supply chain of new construction equipment post-pandemic and rising used equipment prices are significant threats to Canada used construction equipment market. However, used equipment is expected to remain popular among small contractors for a short interval of projects due to diverse portfolios & low acquisition cost & good resale value.
MARKET TRENDS & DRIVERS
Affordable Housing Scheme
Canada Mortgage & Housing Corp. states that the country must construct 3.5 million homes by 2030 to achieve affordable housing. Canadian government increases investment in the country’s housing sector under the affordable housing scheme. In budget 2022, USD 150 million is allocated for the next two years to support affordable housing and infrastructure projects in the north region of Canada. The fund is directed to Nunavut territory (USD 60 million), Northwest Territories (USD 60 million), and Yukon Territory (USD 30 million). These government efforts will help Canada used construction equipment market growth.
The Canadian government also launched National Housing Co-Investment Fund (NHCF) in 2018 with a fund of USD 13.2 billion for constructing 60,000 new houses and repairing 240,000 existing houses by partnering with construction companies over 10 years. According to Canadian housing statistics, there is a 15.1% and 33.7% surge in building permits for residential and non-residential buildings from May 2021 to May 2022. The instant rise in housing projects in the country under the affordable housing scheme is expected to drive the demand for Canada used construction equipment market.
Infrastructure & Public Transit Projects
The government is investing USD 273 billion in infrastructure projects in 2022. Some of the major projects, such as B.C. Hydro’s Site C Clean Energy Project, GO expansion- on-Corridor project, Bruce Power Refurbishment, Darlington Nuclear Refurbishment, and Eglinton Crosstown LRT are in progress in 2022. The government in provinces introduced a five-year plan which includes more than 150 major construction, upgradation, and repair of roadways projects. Twenty-three thousand kilometers of roads and highways and 41,000 bridge repair and maintenance projects are under progress in 2022. All these dynamics will significantly boost Canada used construction equipment market.
Surge In Renewable Energy Projects
Canadian government introduces Smart Renewable & Electrification Pathways Program (SREPs) by allocating funds of USD 964 million for four years, providing support for smart renewable energy & electrical grid modernization projects. The programs support the government’s goal to become a net zero economy by 2050.
In the national budget for 2022, USD 600 million is allocated for the next five years to Smart Renewable & Electrification Program (SREPs). In addition, USD 4.4 billion investment is made for Greener Homes Program, starting in 2022-23. Government introduces low-interest loans for installing photovoltaic panels on rooftops. The Canadian government’s ambitious plan to generate 2GW of solar power by 2030 is expected to support Canada used construction equipment market. In 2021, the government to set up solar PV cells on 1,154 housing and development board blocks and 32 government sites.
Large Used Construction Equipment Demand Restricted by Investment in Green Mining Technology
In 2021, the Canadian government invested in clean mining technology. The Canadian mining industry focused on more sustainable ways to extract minerals to reduce environmental impacts. The government allocated USD 3.8 billion to promote clean mining technology to boost the production of minerals. A rising focus on clean mining technology for eliminating carbon emission and environmental safety is expected to restrict the demand for used large construction equipment such as large excavators, motor graders, loaders, and cranes.
A Surge in Equipment Prices
In 2021 the median prices rose by 18.8% as compared to 2020. The prices of used construction will continue to grow in 2022. Large earthmoving such as excavators, motor graders, & wheel loader prices increased by 14% in Q2 2022. Medium earthmoving such as backhoe loader, mini excavator & trenchers, and aerial equipment such as crane, forklift & aerial platform prices also increase by more than 14% in 2022. The constant rise of expenses can be a main restrictive for Canada used construction equipment market growth. Cost efficiency is one of the essential qualities of used equipment, making it the perfect choice for small repair & redevelopment projects.
Segmentation by Type
- Backhoe Loaders
- Motor Graders
- Other Earthmoving Equipment (Other loaders, Bulldozers, Trenchers)
Material Handling Equipment
- Forklift & Telescopic Handlers
- Aerial Platforms (Articulated Boom Lifts, Telescopic Boom lifts, Scissor lifts)
Road Construction Equipment
- Road Rollers
- Asphalt Pavers
- End Users
- Caterpillar adopts differentiated product offerings in developing economies to target customers. The company believes that the customer-driven product innovations enable it to compete more effectively in Competitive markets.
- In Jan 2022, Volvo CE launched a new business entity, Global load-out Solution, to expand the market for its load-out solutions portfolio & enable customers to transform the efficiency and sustainability of their operations.
- Other prominent vendors in Canada used construction equipment market are Terex Corporation, Case Construction, Tadano & JLG.
- Terex increases the investment in research, development & engineering to meet customer demand, uphold a competitive edge over other players, and maintain regulatory compliance in all the major markets it serves. The company is incorporating alternative power solutions within its different product lines.
- John Deere
- Volvo Construction Equipment
- Hitachi Construction Machinery
Other Prominent Vendors
- Terex Corporation
- CASE Construction
- Ritchie Bros.
- Sandhills Global
- Auction Network
- Apex auctions
- Lyon Alex & Son
- V.I. Equipment
- Great West Equipment
For more information about this report visit https://www.researchandmarkets.com/r/603tvs