Research firm predicts sharp global rise in MHE demand

An improved environment for fixed investment spending will enable manufacturers to invest in expansion and upgrade of facilities. Rising standards of living will boost gains, as consumers increase spending on both durable and nondurable goods. Advances will also benefit from rising construction spending.

Analyst Mike Deneen said: "Continued growth in mining activity, a byproduct of voracious demand for mined materials in China, India, and other developing nations, will also create material handling product demand.”

Growth will be strongest for sales of advanced equipment that reduces the required labor input in operating machinery, helping to curtail labor costs. These and other trends are presented in World Material Handling Products, a new study from The Freedonia Group.

Automated storage and retrieval systems and automated guided vehicles will register the strongest sales growth of any product type through 2018 due to efforts among end users to reduce labor costs, particularly in developed markets such as the US.

Lift trucks will remain the largest product group in dollar terms, benefiting from gains in durable goods manufacturing activity.  

The US experienced strong growth in 2012 and 2013 as manufacturers and distributors filled pent-up demand that had accumulated during the 2007-2009 recession.

The US will continue to be the world’s largest material handling product market, benefiting from an improved outlook for fixed investment spending, which will boost opportunities for costlier items such as cranes and monorails.   

India and China will see the strongest gains through 2018, as rising manufacturing output spurs demand for material handling equipment to facilitate production and distribution. Growth in those nations’ motor vehicle industries will be especially beneficial to material handling product suppliers.

West European markets include many of the most intensive users of material handling equipment in the world because manufacturers in the region have long been among the leaders in adopting automated equipment as a response to high domestic labor costs. Advances in Western Europe will lag the global average, but demand will benefit from a rebound in manufacturing output.