Market Trends of Off-Highway Wheels Industry
The Construction Segment is Expected to Dominate the Market Studied
The construction sector is highly dynamic, and numerous factors, such as the overall economy, budgets, and global economic scenario, are influencing the market鈥檚 growth. Volatility in these aspects affects the businesses of construction equipment OEMs, which will, in turn, affect the demand for off-highway wheels.
The sector's demand for off-highway wheels is dominant due to the extensive need for earth-moving machinery in global infrastructure projects. Large-scale initiatives such as China鈥檚 Belt and Road Initiative and India鈥檚 Bharatmala Pariyojana necessitate a vast array of construction equipment, including excavators, loaders, bulldozers, and backhoes. These projects involve massive amounts of earth moving, which requires durable and high-performance wheels to ensure efficiency and reliability in challenging terrains. As countries continue to invest in building and upgrading their infrastructure, the demand for construction equipment wheels may remain robust.
Several countries are witnessing significant infrastructure growth owing to the increase in investments. The construction of buildings, tunnels, rail networks, roads, and bridges is attracting major investments across the country. Growing infrastructure development across the country is likely to increase the demand for construction equipment during the forecast period. For instance,
- In March 2024, the Indian government inaugurated and laid the foundation for 112 national highway projects across various states worth approximately USD 12.04 billion. These projects include major highway expansions and the introduction of new technologies like GNSS for barrier-free tolling.
In addition, the investments in infrastructure, both public and private, such as the Indonesian National Medium-term Development Plan (USD 460 billion), Vietnam Socio-Economic Development Plan (USD 61.5 billion), and the Philippine Development Plan 鈥淏uild, Build, and Build鈥� (USD 71.8 billion), are expected to increase the demand for off-highway vehicles in this region.
The increase in construction development across the globe is likely to enhance the demand for construction machinery, which, in turn, is likely to enhance the demand for wheels in the coming years.
Asia-Pacific is Anticipated to Dominate the Market
Asia-Pacific (APAC) continues to lead the off-highway wheel market due to several key factors driving growth in the construction, agricultural, and industrial sectors. The noteworthy development of road and rail infrastructure, coupled with significant investments in new projects, has resulted in substantial growth in the construction sector across the region. This has consequently increased the demand for off-highway vehicles and wheels.
APAC countries have been heavily investing in infrastructure to support their growing industrial and service sectors. For instance, China announced significant infrastructure plans involving an investment budget of approximately USD 4.8 trillion, aimed at new projects and speeding up existing construction efforts. This investment is part of China's broader strategy to enhance its infrastructure network, including roads, railways, and urban development, which drives the demand for robust and reliable off-highway wheels.
The agricultural sector in APAC, particularly in India, is another major driver of the off-highway wheel market. The sector's contribution to India's GDP increased significantly, with tractor sales reaching over 900 thousand units in FY 2023. This surge in tractor sales highlights the rising demand for agricultural machinery, which, in turn, may boost the need for off-highway wheels. With agriculture playing a crucial role in the economies of many APAC countries, the demand for off-highway wheels is expected to continue growing.
The construction sector in APAC is dominated by both private and state-owned enterprises, with increased spending on commercial projects, renewable energy, and public infrastructure. Countries like Japan, China, and India are seeing strengthening markets for construction machinery and excavators, driven by ongoing and planned mega-projects.
