Construction Equipment Industry Sees ~10% Decline in Domestic Sales
According to the latest industry data reported by ICEMA (Indian Construction Equipment Manufacturers Association ), domestic sales of construction equipment (CE) saw a degrowth of around 10% from 89,244 units in YTD FY (Year till date of Financial Year) 2024-25 to 81,566 units in YTD FY 2025-26 (Apr –Dec 2025), reflecting slower infrastructure activity, project execution challenges, unavailability of finance and near term subdued demand in key segments. Exports, however, surged strongly, reinforcing India’s competitiveness in international markets.
In Q3 FY26, as per the data collated by ICEMA, total CE sales including domestic sales, OEM exports and unauthorised exports, stood at 35,891 units — a 9% YoY decline compared with Q3FY25, highlighting ongoing demand challenges. Earthmoving equipment with largest share recorded 25,715 units, registering a decline of 9 % from Q3 previous financial year. The total sales of material handling equipment was 4,306 units, witnessing degrowth of 10% YoY for Q3FY. Concrete equipment sales stood at 3,335 units, declining by 9% YoY. Road construction equipment reported 1,942 units, with a decrease of 7% YoY. Material processing equipment accounted for 593 units, declined by 1% from Q3FY25.
While domestic sales were reduced by 10%, exports grew by 28%, cushioning the overall industry decline to 5% in the first nine months of FY26 with total 94,035 units compared to 98,977 units in YTD FY25, indicating robust overseas demand and market diversification. There is a de-growth of industry despite the presence of unauthorised exports in the reported numbers, and if we take out those then the decline in the industry is even more severe. “The unauthorised exports have been a major concern for the industry mainly for backhoe loaders and excavators, wherein the equipment is sold by OEM in domestic market and is exported without information to OEM and Finance companies, posing a loan repayment default risk to Finance companies,” the report said.
Deepak Shetty, President, ICEMA and CEO & Managing Director, JCB India Ltd., shared: “The domestic demand for YTD FY 25-26 has remained muted. The growth of our industry is significantly dependent on infrastructure development projects where we experienced some headwinds. This was also a period of adjustment for customers after the CEV Stage V emission standards came into effect, which impacted on the asset value of our products. As the industry adapts the new emission norms, export competitiveness is expected to strengthen with new geographies opening as export destination for India.”
Ramesh Palagiri, President Designate, ICEMA and Managing Director & CEO, Wirtgen India Pvt. Ltd., stated: “Although domestic demand has been impacted by slower project awarding and execution, we are optimistic of a turnaround. With strong export performance and the hope of front-loaded awarding of projects and higher infrastructure capex in the upcoming Budget, we believe domestic CE demand will strengthen and contribute to a sustained industry recovery in 2026.”
Vivek Hajela, Convener, ICEMA Industry Analysis & Insights Panel and Executive Vice President & Head, Construction & Mining Machinery Business — L&T Construction & Mining Machinery, Larsen & Toubro, added: “While execution pace & contract award in road construction has moderated due to land acquisition and approval delays, the underlying pipeline of projects remains healthy with significant sanctioned projects and improved awarding activity. With streamlined processes and focused execution, we expect this to translate into stronger domestic CE demand in the coming months as infrastructure progress accelerates.”
Prepared by the ICEMA Industry Analysis & Insights Panel, the report is based on data collated from OEM members representing around 95% of India’s CE industry, ensuring comprehensive and credible insights for policymakers and industry stakeholders.
