Construction Equipment Sales Fall 12.6% in Jan; OEMs Feel the Heat
India’s construction equipment (CE) industry reported a sharp slowdown at the start of 2026, with sales declining 12.6 per cent year-to-date (YTD) in January, according to data released by the Federation of Automobile Dealers Associations (FADA). As per the data, total CE retail stood at 74,029 units, down from 79,316 units in 2024.
The segment also posted a steep year-on-year drop in January, emerging as one of the weakest-performing categories even as overall automobile retail sales recorded healthy growth during the month.
FADA’s data shows that while passenger vehicles, two-wheelers, tractors and commercial vehicles registered double-digit growth, construction equipment demand remained subdued, reflecting slower on-ground project activity and cautious capital spending by contractors.
Market leader JCB India retailed 34,833 units in 2025, commanding a market share of around 47 per cent. Action Construction Equipment (ACE) followed with 8,269 units, while Ajax Engineering sold 4,879 units during the year.
Other key players included Escorts Kubota (CE division) with 4,723 units, CASE Construction Equipment with 2,034 units, and Tata Hitachi Construction Machinery at 2,014 units.
Given the 12.6 per cent YTD contraction in January 2026, industry observers expect leading OEMs to have seen volume pressure at the start of the year, particularly in high-volume categories such as backhoe loaders and hydraulic excavators.
The decline could be because of the delays in project mobilisation in some states, inventory correction at the dealer level and a high base effect from the previous year. The slowdown comes despite continued policy emphasis on infrastructure spending. Pickup in highway construction, mining clearances and urban infrastructure rollouts will be crucial for reviving equipment demand in the coming quarters.
Through the Equipment India Lens:
The January decline signals a cyclical pause rather than a structural downturn. Key implications include:
- Retail slowdown despite broader auto growth indicates project-linked demand softness.
- Dealer inventory correction may continue through the first quarter.
- High-volume segments such as backhoe loaders could remain under pressure in the near term.
- Mining clearances and highway project acceleration will be critical for recovery.
- OEMs may increase retail push and financing support to stimulate demand.
- A pickup in state-level infrastructure spending could act as a trigger for revival.
If project execution regains momentum by mid-year, the industry could see a phased recovery in the second half of 2026.
A-303, Navbharat
Estates,
Zakaria Bunder Road,
Sewri (West), Mumbai - 400 015,
Maharashtra, India
+91-22-24193000
Subscriber@ASAPPinfoGlobal.com