The Indian construction equipment sector encountered significant headwinds in the calendar year 2025, registering a notable contraction in retail sales. Data from the Federation of Automobile Dealers Association (FADA) reveals a year-on-year decline of approximately 7% in total volumes, painting a challenging picture for the industry.
Analyzing the 2025 Downturn: Key Factors at Play
Industry leaders point to a confluence of factors that led to the slump. Sorab Agarwal, Executive Director of Action Construction Equipment (ACE), highlighted that prolonged monsoon conditions across crucial construction zones severely disrupted project timelines. Simultaneously, the industry's transition to stricter Stage V emission norms resulted in increased equipment costs, prompting some customers to temporarily postpone their purchase decisions.
Agarwal further explained that the market dynamics were affected by pre-buying activities in 2024 ahead of the emission norm change. This, combined with a cautious approach to capital expenditure due to global macroeconomic uncertainties and tighter financing availability, created a softer demand environment, as clearly reflected in the FADA retail data.
Market Share Shifts and Major Player Performance
The FADA report, which tracks retail registrations for specific equipment categories, shows that industry volumes fell to 74,029 units in 2025 from 79,316 units in 2024. The market leadership saw some recalibration during this period.
JCB maintained its top position but witnessed a drop in volumes to 34,833 units from 40,351 units in 2024. Consequently, its market share reduced to 47.05% from 50.87% the previous year.
Occupying the second spot, ACE sold 8,269 units, slightly down from 8,877 units. Its market share remained largely stable, edging down marginally to 11.17% from 11.19%.
Other significant contributors to the market included:
- Ajay Engineering: Sales increased to 4,879 units from 4,515 units.
- Escorts Kubota: Volumes declined to 4,723 units from 5,476 units.
- Case New Holland: Recorded growth, selling 2,034 units compared to 1,834 units in 2024.
- Tata Hitachi: Reported sales of 2,014 units, up from 1,883 units.
All other companies sold fewer than 2,000 units each during the year. Agarwal noted that FADA's retail data is a specific subset, and broader industry estimates encompass non-registered equipment, institutional buys, and other specialized applications.
Road to Recovery and Policy Recommendations
Despite the tough year, the industry is optimistic about a turnaround in 2026. ACE anticipates a broad-based recovery driven by several positive indicators. These include a projected rise in private capital expenditure, new export opportunities, expanding defence sector applications, and continued strong public investment in major infrastructure projects like airports, railways, and freight corridors.
To bolster domestic manufacturing, Agarwal also urged the government to consider imposing anti-dumping duties on Chinese crawler excavators and tower cranes. This measure is seen as crucial to ensuring a level playing field and strengthening India's own construction equipment ecosystem against international competition.
