Construction EVs a $240b market in 20 years

Electric construction vehicles are predicted to be a NZ$240 billion (US$150b) market in 2043, equal to 2022’s non-EV market.

So says IDTechEx in its report Electric Vehicles in Construction 2023-2043.

The report covers electric mini-excavators, electric excavators, electric loaders, telehandlers, and more.20-year forecasts of units, GWh demand and revenue, by region and vehicle type.

More than 100 electric construction machines have been analysed to reveal trends in battery sizing, charging, vehicle power, pricing, and more.

“The electric construction machine market is in its nascent stages,” says IDTechEx.

“However, it will benefit from other sectors having already gone through electrification and will be able to accelerate quickly with existing supply chains for batteries, motors, and other electric vehicle components that it will need to make this transition.

“OEMs are moving quickly to electrify their product ranges. This has started with mini-electric excavators but is now progressing to larger machines.”

The report considers OEM activities, policy drivers, and potential total cost of ownership savings to predict a 10-year CAGR of 38%, and growth to an electric construction machine market value of about US$150 billion (NZ$240b) in 2043.

“This will put the construction industry on target to hit international carbon neutrality goals by 2050.”

Mini excavators are the third largest segment by volume in the world, and the largest segment in Europe, says IDTehEx.

“With its smaller size necessitating reasonably sized batteries, it has been a low hanging fruit for the construction industry to begin their electrification journey.

“In 2023 six out of the top 10 largest construction OEMs, including Caterpillar, Komatsu, Kubota, and Hitachi, either had a production electric mini excavator, or had a concept or prototype.

“JCB and Volvo are companies with examples of series production electric mini excavators and have helped to kick-start the electric mini excavator market.”

Electric mini excavators offer all the performance of diesel variants but with some significant advantages, says IDTechEx.

“Firstly, it improves local air quality and more importantly the air quality for the operator who will be exposed to high concentrations of exhaust gases. The operator will also benefit from reduced noise, reduced vibration, and improved safety through better communication with other site workers thanks to the machines lower noise.

“The electric motors will also give more precise control over the machine, and in the long term, aid the integration of autonomous features, such as automated digging.”

 IDTechEx says more electric machines are coming, and they are getting larger.

“OEMs are already moving onto larger machines. Large excavators with operating weights of more than six-tonne, and similarly sized loaders, are the two areas where OEMs like Caterpillar, John Deere, XCMG, Komatsu, Volvo, and LiuGong are looking to electrify next.

“Loaders and excavators make up nearly 55% of construction vehicle sales by volume. Excavators are the largest by volume, and with their increased size comes higher prices, meaning they also dominate revenue.”

Chinese OEMs especillay have shown interest in electrifying larger excavators and installing large batteries, says IDTechEx, citing an example which uses a 525kWh battery and double gun-DC charging to replenish this enormous battery in two hours.

“However, the biggest battery IDTechEx has seen in an excavator is 700kWh from a Japanese OEM also covered in this report.”

Within China, lithium iron phosphate (LFP) appears to be the cell of choice for these larger systems, which makes sense given its lower cost and the vehicles not being sensitive to the extra weight, says IDTechEx.

“Meanwhile, Europe has tended to go with nickel, manganese, cobalt oxide (NMC) as its cell of choice for batteries in electric construction machines.

“NMC offers better performance, but at additional cost. This report goes into detail on the trade-offs between NMC and LFP relating to construction, while also explaining how lithium-ion battery price reductions can sway the balance between choosing an electric construction machine, or a diesel.”

 Total cost of ownership savings are likely to drive construction EV uptake, the report suggests.