The construction machinery market will show prosperity in 2026.
Zheshang Securities predicts that the domestic update cycle is expected to gradually enter an upward channel in 2026.
According to data from the China Construction Machinery Industry Association, 24,794 excavators of various types were sold in May 2026, a year-on-year increase of 36%, of which domestic sales were 11,628 units, a year-on-year increase of 39%; exports were 13,166 units, a year-on-year increase of 34%.
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According to May data, the total sales volume of excavators was 126,875 units, a year-on-year increase of 25%; of which, domestic sales were 68,127 units, a year-on-year increase of 18%; exports were 58,748 units, a year-on-year increase of 33%.
The overseas market share of construction machinery continues to increase, and the domestic update cycle is gradually starting.
The overseas market share of my country’s construction machinery OEMs has increased. The advancement of urbanization and industrialization in the “Belt and Road” region has brought about growth in demand for infrastructure and real estate. The demand for overseas mining is booming, and the positive growth trend of my country’s excavator exports is expected to continue.
The domestic excavator cycle is bottoming out and rising, mainly due to factors such as agriculture, forestry, and municipal demand driving the demand for small and micro excavations, my country’s main engine manufacturers continuing to make breakthroughs in the field of mining machinery, water conservancy demand bringing demand for large and super-large excavations, and the gradual start of domestic renewal demand.
The recovery of China’s construction machinery industry presents a trilogy.
The first is export, which contributes to the main source of profits for engineering machinery OEMs.
In 2025, the foreign (overseas) revenue and gross profit of the five major construction machinery OEMs will account for 55% and 65%.
From January to April 2026, my country’s cumulative export volume of construction machinery was 152.3 billion yuan, a year-on-year increase of 18%; in April, the export volume was 39.9 billion yuan, a year-on-year increase of 8%.
Export growth has benefited from factors such as increased overseas market share, increased demand for infrastructure and real estate driven by industrialization and urbanization in emerging markets, and booming mining demand.
According to KHL data, the total sales of the world’s top 50 construction machinery manufacturers in 2026 will be US$246.5 billion, of which XCMG Machinery/Sany Heavy Industry/Zoomlion have a market share of 5.8%/5.1%/2.8% (a total of 13.7%). There is huge room for improvement in the future.
In terms of domestic demand, the domestic excavator cycle is bottoming out. At the same time, benefiting from wind power and other factors, the demand for engineering cranes has increased. Affected by factors such as the trend of electric concrete mixers replacing internal combustion mixers, the update cycle of engineering cranes and concrete machinery has gradually started, and the recovery of domestic demand has been transmitted from excavators to trenchless.
In terms of updates, the domestic update cycle is gradually starting, and the cycle is expected to bottom out and move upward.
2015 was the low point of the last cycle of excavators. Based on the update cycle of 8-10 years, it is expected that the domestic update cycle will gradually enter the upward channel in 2026.
Due to the continued rise in bulk raw materials and the rise in comprehensive manufacturing costs and other factors, the costs of construction machinery OEMs have increased, and some leading OEMs have raised the prices of excavators and cranes.
In terms of excavators, Sany Excavator has raised its excavator prices by 5% since May 15;
In terms of cranes, Sany will increase the prices of wheeled/crawler cranes by 2% – 5% for different models starting from July 1;
In terms of investment recommendations, we continue to focus on industry leaders, with emphasis on recommending Hengli Hydraulics, Sany Heavy Industry, Xugong Machinery, Zoomlion Heavy Industry, Shantui Co., Ltd., Weichai Power, and Hangcha Group; we continue to recommend Liugong, Anhui Heli, Zhongli Co., Ltd., Zhejiang Dingli, etc.
However, we should also pay attention to the risks of overseas trade frictions and exchange rate fluctuations.
