The Construction and Mining Equipment Industry Group collaborated with Datamotive Business Intelligence to gather the unreleased sales figures, and said the decline in 2009 followed a 6.5% year-on-year fall in 2008, revealing the growing impact on equipment sales as the credit crunch morphed into the GFC.
CMEIG chief executive John Reid said prospects were looking decidedly better for 2010 as December sales were up 13% year-on-year.
“Market conditions certainly improved during the second half of the year, due to increased confidence, the improving economic climate and the impact of the federal government’s investment allowance scheme,” he said.
“In overall terms we expect the market to rise by 5 to 6 per cent during 2010 compared with 2009, as economic conditions improve and demand increases in both the construction and mining markets.”
Supporting this forecast is the level of machine deliveries ordered in 2009 under the investment allowance scheme and increased federal and state government infrastructure spending.
CMEIG also factored in a general improvement in economic conditions and the likelihood that growing Chinese and Indian commodities demand will continue this year.
CMEIG’s 2009 highlights
The industry group estimated the total construction and mining equipment market was worth $A3.2 billion last year.
Queensland led the states with 30.4% of national equipment sales, followed by New South Wales at 23.4%, Victoria 18.4% and Western Australia 15.8%.
Hydraulic excavator sales fell by 24% year-on-year but this leading category still accounted for 39% of the total earthmoving equipment market.
Wheel loader sales dived 36% with CMEIG saying this reflected a significant decline in infrastructure project spending.
The industry group attributed the 30% fall in dozer sales to a lack of investment by mining companies and contractors.
A 32% decline in rigid dump truck sales was also linked to the lower mining industry spend last year, and articulated dump truck sales were down by 45%.
CMEIG pointed to falling local government expenditure for the 30% slump in motor grader sales.
In the smaller equipment stakes, skid steer loader sales fell 19% last year and backhoe loader sales dropped 22%.
Skelton Sherborne Shipping Index
The index provided by Australia’s dominant heavy equipment importer and the Australian Bureau of Statistics for December revealed a 20% fall in the free-on-board value of machinery equipment imports from November to $131 million.
But Skelton said December and January were normally the quietest months of the year and that its own enquiry levels and cargo volumes continued to improve.
A total of 1650 machines were imported in December compared to 1677 in November.
Excavators below 12 tonnes accounted for 32% of the December figures with 523 imported.
Graders, wheeled dozers and screeners all had noticeable falls in the December index but Skelton said bulldozers had been up substantially for two months, increasing 43% in December.
The lifting market looks better as tracked crane imports were up 443% in December compared to November, while mobile crane imports jumped 300%.
But the tough lending market is still playing a major role in equipment sales and Skelton noted that new finance contracts for construction and earthmoving equipment fell again in December.
“This statistic has effectively crashed from figures of about $40 million per month back in 2008 to now less than $4 million per month,” Skelton commented in the December index report.