As a core pillar of the real economy, the performance of theconstruction machinery industry is deeply intertwined withmacroeconomic cycles, industrial policy guidance, and the globalmarket landscape. In 2025, the Chinese construction machineryindustry is entering a critical turning point. The concentratedlaunch of the domestic equipment replacement cycle is driving arebound in the domestic market, while overseas markets are upgradingfrom "incremental supplements" to "profit core,"with both factors jointly propelling the industry out of cyclicalfluctuations and towards a new journey of high-quality development.According to the China Construction Machinery Association, totalexcavator sales in 2025 reached 235,257 units, a year-on-yearincrease of 17%, with domestic sales at 118,518 units (a 17.9%increase) and exports at 116,739 units (a 16.1% increase). Domesticand overseas sales volumes were roughly equal, achieving a historicoptimization of the industry's growth structure.
The core driving force behind the recovery of the domestic marketstems from the comprehensive launch of the equipment replacementcycle, a trend that exhibited a distinct characteristic of"concentrated release and strong rigidity" in 2025. Fromthe perspective of the industry life cycle, the reasonable servicelife of core construction machinery equipment is 7-10 years. From2017 to 2020, the domestic construction machinery industryexperienced a period of rapid growth, with cumulative sales exceedingten million units. This equipment is now entering a concentratedphase of aging and obsolescence in 2025. Data from the ChinaConstruction Machinery Association shows that the demand forequipment replacement in the domestic market reached 62% in 2025,with excavator replacement demand accounting for over 58% of totaldomestic sales, becoming the "cornerstone" of domesticsales growth. Unlike previous short-term, policy-driven growthspurts, this replacement demand stems from the dual demands ofnatural equipment replacement and environmental upgrades, resultingin greater market resilience.
Policy coordination and the recovery of downstream demand furtherinjected growth momentum into the domestic market. In 2025, domesticinvestment stabilization policies continued to be implemented, withtools such as ultra-long-term special national bonds and specialbonds precisely targeting areas such as new infrastructure, waterconservancy and flood control, urban renewal, and ruralrevitalization. Infrastructure investment increased by 8.3%year-on-year, providing solid support for the demand for constructionmachinery. In the large-scale engineering sector, projects such asthe subsequent phases of the Sichuan-Tibet Railway and comprehensiveenvironmental remediation in the Yangtze River Economic Belt arestarting construction in rapid succession, driving demand formedium-to-large tonnage excavators and cranes. In county-levelmarkets, livelihood projects such as high-standard farmlandrenovation and upgrades to rural water conservancy facilities haveboosted sales of small-tonnage excavators by 22.4% year-on-year,creating a balanced growth pattern across all tonnage categories.Simultaneously, the full implementation of National IV emissionstandards has accelerated the phasing out of older, high-emissionequipment. This policy-driven replacement demand, combined withmarket-driven upgrades, further solidified the recovery trend indomestic sales.
Compared to the steady recovery of the domestic market, "goingglobal" has become a core strategic direction for domesticconstruction machinery manufacturers and component suppliers to breakthrough growth bottlenecks and seize high-profit margins. In 2025,China's construction machinery exports continued their strongperformance, with the total export value expected to exceed US$59billion, a 12% year-on-year increase. Excavator exports accounted for49.6% of total sales, with the overseas market's contribution toindustry growth equaling that of the domestic market for the firsttime. More importantly, the profitability advantages of overseasbusiness continued to be evident, with domestic constructionmachinery companies generally achieving gross profit margins 3-14percentage points higher in overseas markets than domestically. Thishas become a key strategy for companies to offset domestic marketcompetition pressure and optimize their profit structure. Componentmanufacturers also followed suit with their overseas expansion, withcore component exports increasing by 18.7% year-on-year, creating ahealthy ecosystem of coordinated overseas expansion for both mainequipment and components.
In 2025, the effectiveness of leading construction machinerycompanies' global layouts continued to be evident, with overseasrevenue share steadily increasing, becoming a core driving force forthe industry's globalization. Public data shows that the proportionof overseas sales revenue for leading companies generally exceeded50%, with some companies reaching over 64%, indicating that theoverseas market has upgraded from a "secondary market" to a"core market." From a regional perspective, emergingmarkets such as Southeast Asia, the Middle East, and Latin Americaremain the main drivers of exports. In 2025, China's exports ofconstruction machinery to these regions increased by 21.3%, 19.5%,and 17.8% year-on-year, respectively, driven by acceleratedinfrastructure investment in these regions and improved localizationcapabilities of Chinese companies. Simultaneously, breakthroughswere achieved in high-end markets in Europe and the US. Leveragingthe advantages of electrified and intelligent products, China'sexcavator exports to Europe maintained a year-on-year growth rate of34.6%-53.1%, breaking the long-standing monopoly of European andAmerican companies in the high-end market.
Looking ahead to 2026, the Chinese construction machinery industrywill officially enter an accelerated globalization phase. Majormanufacturers are increasing their investment in overseas resources,focusing on improving sales networks and building localizedproduction capacity, thus opening a new chapter in globalcompetition. In terms of production capacity layout, leadingcompanies are accelerating the construction of overseas industrialparks, with bases in South Africa, Hungary, Germany, and otherlocations successively starting production or expanding capacity,achieving a transformation from "product export" to"localized production," reducing trade barriers andlogistics costs. In terms of channel development, companies arefocusing on improving overseas after-sales service systems,establishing parts centers, repair stations, and training bases toenhance localized service response capabilities. In product researchand development, customized products are being developed fordifferent regional market needs, focusing on electrification,intelligence, and zero-carbon technologies to strengthen corecompetitiveness.
It is worth noting that while the industry is developing rapidly, thetrend of structural differentiation is becoming increasingly evident.Leading companies, leveraging their advantages in technology,capital, and channels, continue to seize market share bothdomestically and internationally, further increasing industryconcentration. Meanwhile, small and medium-sized manufacturers facechallenges such as insufficient R&D investment, weak overseaschannels, and shrinking profit margins, leading to accelerated marketelimination or transformation into niche areas. In the future, thecore of industry competition will shift from single-productcompetition to a comprehensive competition of global layoutcapabilities, technological innovation capabilities, and localizedservice capabilities.
Overall, in 2025, the Chinese construction machinery industryachieved high-quality growth, supported by the start of the domesticreplacement cycle and breakthroughs in overseas markets. The industrystructure continued to optimize, and global layout entered a deeperstage. In 2026, with the continuous improvement of overseasproduction capacity and sales networks, coupled with sustaineddomestic infrastructure investment and continued demand for equipmentupgrades, the industry is expected to maintain its prosperousmomentum. For businesses, only by firmly seizing the opportunitiespresented by electrification and intelligent transformation, and bydeeply cultivating domestic and international niche markets andstrengthening their global foundation through localized operations,can they gain a competitive edge in the increasingly fierce globalcompetition and propel China's construction machinery industry to thehigh end of the global value chain.
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