Issue link: https://read.dmtmag.com/i/1531611
low to mid-single-digit penetration rates by 2030, driven by cities that re- quire zero-emission vehicle (ZEV) -based construction projects within city limits. For ZEV penetration to be more prevalent in con- struction equipment, the solution's versatility has to evolve in line with battery performance and cost. We do expect a significant focus on autonomous solu- tions to optimize worksite performance. Rather than a regulatory push, as is the case for electrifica- tion, these solutions oen experience customer pull as they improve efficiency and reduce labor depen- dency at construction sites. A case in point is collision awareness and avoidance systems. Another significant trend is the increased use and intensity of connected ser- vices. In particular, a better understanding of machine problems and a proactive, maybe even predictive maintenance approach improve fleet uptime while increasing parts sales for original equipment manu- facturers. Connectivity also opens the door for fixed- rate maintenance contracts that enable the exploration of new business models for OEMs and fleets. While construction equip- ment also finds significant applications in agricul- ture, the overall trends are different. e agriculture market will likely be sub- dued for the next few years. e COVID-19 pandemic and Ukraine war-induced commodity boom has led to a robust market in which farmers bought what they needed and wanted. Most farmers are now careful regarding purchases given a more challenging market environment and are post- poning purchases as long as possible. e main driver for growth in the mining business is a combination of global GDP growth and declining ore grades, which require more equipment to move more material of less- er value. Regional trends vary quite a bit. Globally, a decline in coal at about 1% will be offset by around 2% growth in metals and minerals and is primarily focused on battery materi- als, copper and iron ore. Dematerialization re- duced material demand globally, albeit by less than 1%. e increasing prevalence of recycling, especially in steel (iron), aluminum, copper and bat- tery materials, reduces the demand for new materials mined. Autonomy and auton- omous hauling solutions are well established in the mining industry and will continue to drive work site productivity gains by 2030. ese work site productivi- ty gains of 5 to 10% reduce the number of equipment needed, while electrifica- tion, e.g., of 240 t haulage trucks, will require more trucks to handle the same load as frequent charging reduces uptime by 15 to 20% according to our total cost of ownership (TCO) models. However, as the overall impact of electrifi- cation remains low till 2030 with less than 2% penetra- tion, the overall effect of electrification on equip- ment volumes is expected to remain moderate. Higher growth in India, Indonesia, China and the Middle East will dominate the next several years. Africa also will continue to play a role, but similarly to the previous discussion on construction equipment, Western players will face competent Chinese com- petition in these emerging markets. 3 Considerations for Western OEMs 1. Companies should watch their costs while taking advantage of global growth opportunities and enable frugal growth. 2. Prepare for a strengthening Chinese competition by: • Understanding Chinese cost structures, strategies and ambitions • Understanding cus- tomer needs in emering markets • Developing product and service offerings for these use cases • Investing in service solutions to bind cus- tomers beyond the pure performance of their product • Monitor Chinese technological progress and customer value solutions 3. Continue to invest in worksite optimization solu- tions standalone and with partners. e Chinese challenge is similar to the entry of the Japanese and Korean play- ers on the global stage. Yet, China's scale and installed capacity dwarf anything the industry has seen. While it is not too late to prepare, Western OEMs and suppli- ers have no time to lose. https://www.forconstruc- tionpros.com IDA Universal January - February 2025 26 Trends and Tidbits Continued from page 24 Trends & Tidbits continued on page 28