Most types of off-highway equipment do not yet have the sales volumes when it comes to electrification that are seen in cars, trucks and buses. The market is at an earlier stage and growth is likely to be very high but starting from a very low point. This means the anticipated growth will be “lumpy” (i.e. with ups and downs and some regions/equipment types growing strongly, while others remain stuck at a very low level). The rate of growth depends on various factors such as available subsidies, the strategic approach of a few leading suppliers, the availability of charging infrastructure, and the unpredictable and somewhat low demand from customers. However, there will be certainly be opportunities arising within the sector.
For example, wheel loaders have emerged as an area of growth in off-highway electrified equipment during 2023 and 2024, with an estimated 4,535 full electric BEV registered in 2023 and a further 12,080 forecast for 2024. We predict this figure will grow to over 40,000 in 2030, representing a strong opportunity for original equipment manufacturers (OEMs) and component manufacturers. The majority of wheel loaders will be manufactured in Asia Pacific (led by China), with some market growth in Europe. Outside of China and Europe, sales are much lower. Indeed, in the Americas, electric excavators and tractors have higher sales than electric wheel loaders.
The market for electrified wheel loaders is expected to increase sharply between 2023 and 2030.Interact Analysis
Outside of China, growth in battery electric vehicle (BEV) wheel loader sales during 2024 has been limited due to a weak construction industry, high interest rates and a shortage of government incentives. Outside of China and Europe, there is lack of both awareness and product availability, with sales are struggling to get off the starting line.
On the other hand, Asia Pacific sales of wheel loaders have grown sharply in 2024. Electrified wheel loaders have a much larger share of the total wheel loader market in China than elsewhere. In Europe (and North America) mini excavators are considered to be easier to electrify, as less energy is used during the working day and the smaller batteries are easier to charge than specialty high-power chargers.
One reason for the higher percentage of electrified wheel loaders in China is that they are sometimes used where there is a shorter working cycle. Additionally, major customers for electric loaders in China are thought to be in the steel, coal, mining and cement industries where there is more pressure for emission reductions. In China, all major loader OEMs have electric wheel loaders. Chinese vendors are now increasingly promoting their products elsewhere, with wheel loaders such as the Luigong 820TW and larger 870HE presented in Europe this year. Liebherr also presented the L 507E within the last 12 months, adding to the existing products available from Giant/Tobroco, Avant, Wacker Neuson, Volvo, JCB and others.
Global revenues for powertrain components in electrified wheel loaders (including battery packs) are projected to reach $450 million in 2024. Battery packs account for $140 million of the total, with the market size for motors (including electric motors in diesel-electric wheel loaders) anticipated to be a similar amount. Inverters also contribute significantly to the powertrain value, with onboard chargers and dc/dc converters adding a smaller amount. The only vehicle types we cover in our Off-Highway Powertrain report with higher projected 2024 revenue than wheel loaders (for electrified vehicle components) are forklifts and scissor lifts, which are more commoditized markets with lower profit margins.
Revenues for components in electrified wheel loaders will grow slowly as price erosion offsets some of the growth in vehicle numbers and the majority of this revenue will be in Asia Pacific, especially China. However, even when Asia Pacific is excluded, revenue will still be higher than all other categories except for forklifts, scissors and boom, where are high rates of electrification.
Electrification numbers in off-highway may seem quite modest for now, but it is just the beginning. Companies with the right products in 2025 to 2026 will be best positioned to emerge at the front of the queue in 2030 to 2035 when volumes are higher. In the long term, we think a very high share of off-highway equipment will electrify, especially compact equipment. It’s important to factor in the time not just to research and develop product, but also for the learning curve with regards to customer needs, charging infrastructure, dealing with regulators, and other factors. The winners of large market shares post-2030 are taking action now to ensure that they are ready.
Wheel loaders is just one of the equipment categories in our comprehensive Off-Highway Powertrain report. The others are bulldozers (crawler loader and crawler dozer), excavators (mini, small, medium and large), backhoe loaders, skid steer/compact tracked loaders and underground load haul dump, scissors, boom, tractors, combines, telehandlers, haul dump trucks and forklifts. The report has forecasts of vehicles and components by powertrain, voltage and region.
