Market Trends of France Construction Equipment Industry
Increasing Government Spending on Construction and Infrastructure Development
- Increasing investment in the country's real estate sector, commercial sector, and construction sector, among others, is further aiding the surging growth of advanced construction machinery across France. Various development projects, such as the Grand Paris Project, assist in expanding the construction market across the country, thus, in turn, positively impacting the demand for construction equipment.
- For instance, in October 2022, the French government announced a bidding scheme to build or refurbish 5,000 sports facilities across France before the 2024 Olympics and Paralympics. Further, the National Sports Agency (ANS) reported that 2,089 facilities were already co-financed for this project as of October 2022.
- The Grand Paris Project initiative, the largest transportation project in Paris, which is being carried out in phases till 2030, has attracted billions of investments in the construction sector. The project envisages the expansion of Line 14 and the construction of four new automatic Lines. Further, the project outlines a new metro development with an estimated investment of Euro 36.1 billion (USD 47.7 billion), 30% of which is being financed by the French Government through Societe du Grand Paris (SGP) and the remaining 70% by the local authorities through earmarked taxes, subsidies, and loans.
- Coupled with that, rising investment in enhancing the transportation infrastructure of the nation is expected to boost the construction equipment market in France in the coming years. Various private companies operating across France, such as Electron, are actively focusing on enhancing the decarbonized road transportation infrastructure to assist the government in its decarbonization efforts. For instance,
- In July 2023, Bpifrance, the French public sector investment bank, selected Electreon's award-winning Wireless Electric Road System (ERS) for an unprecedented project in France on a section of the A10 highway southwest of Paris. As per the agreement, Electron will deploy both a two-kilometer dynamic wireless charging road and a stationary wireless charging station, along with unveiling its next-generation product with significantly increased power transfer capacity for dense traffic corridors on public highways.
- With the government's consistent effort to build a decarbonized public transport infrastructure, along with the support provided by the private construction companies to assist the government's pragmatic plans, the construction equipment market is anticipated to record surging growth during the forecast period.
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Electric Drive Segment of the Market to Gain Traction during the Forecast Period
- The extensive focus of the French government to achieve a carbon-neutral economy is aiding the rapid transformation in various sectors in adopting a new energy ecosystem. With the aggressive strategy adopted by the government of France to achieve a reduction in carbon emissions, there will exist a greater demand for advanced products used in various sectors, which helps in the reduction of carbon content in the environment.
- For instance, in May 2023, The French government unveiled a plan to accelerate cuts to its greenhouse gas emissions, targeting a reduction of 50 percent by 2030 compared with 1990 levels. The plan unveiled by the government portrayed a roadmap that included detailed figures for reductions for individual sectors of the economy, ranging from the transport industry to households.
- It is witnessed that new energy investment, against the backdrop of the government's aggressive push towards achieving a carbon-free economy, assisted the increasing investment in the energy transition projects across France. In 2022, new investment in energy transition in France stood at USD 29 billion, which expanded with a CAGR of 45.8% between 2018-2022.
- With the shifting focus towards adopting a new energy ecosystem, various companies operating in different industries are actively promoting the use of products and equipment to help in air pollution reduction. Construction equipment companies operating in space are investing hefty sums in developing new products that are operated via an electric drive type, which is expected to record surging growth in the coming years. For instance,
- In November 2022, Caterpillar announced the launch of its first battery electric 793 large mining truck. The demonstration of the equipment was carried out at the company's Tucson Proving Ground.
- In October 2022, Komatsu unveiled its first 20-tonne battery electric excavator, named PC210LCE, at the ConExpo. The excavator features a lithium-ion battery technology developed by Proterra, having a 451 kWh battery capacity, designed for up to eight hours of operating time.
- These electric construction equipment products being developed by international manufacturers are being made available to French customers via their dealership network operating in the country.
- With the increasing focus on decarbonization, there will exist a greater demand for electric drive-type equipment in the coming years as more and more construction and rental companies include these products in their fleet, thereby expected to positively contribute to the growth of the electric drive-type segment of the market during the forecast period.
