The Middle East engineering vehicles market is projected to expand steadily through 2035, driven by large-scale infrastructure investment, mining expansion, and economic diversification programs across the GCC, according to a new report by IndexBox.

The market is estimated at between $9 billion and $12 billion in 2026, with Saudi Arabia, the UAE, and Qatar accounting for around 60–70% of total regional demand. The sector is forecast to grow at a compound annual rate of 4.5–6.0% through 2035, reaching an estimated value of $15–20 billion.

Growth is being supported by government-led investments in transport corridors, housing, industrial zones, logistics infrastructure, and mega-projects linked to national development agendas such as Saudi Vision 2030, the UAE’s Projects of the 50, and Qatar’s post-World Cup infrastructure expansion.

Earth-moving and excavation equipment remains the region’s largest segment, accounting for an estimated 35–40% of demand by value in 2026, followed by material handling and logistics equipment at 20–25%. Mining and quarrying vehicles represent 10–15% of regional demand, particularly in Saudi Arabia, Oman, and the UAE.

The report noted that the region remains structurally dependent on imports, with more than 80% of heavy equipment sourced from manufacturers in the United States, Japan, Europe, China, and South Korea. However, local assembly and customization hubs in Saudi Arabia and the UAE are gradually expanding to capture greater value from aftermarket services and final vehicle configuration.

Demand for rental equipment and aftermarket services is also rising faster than new vehicle sales, as contractors increasingly seek flexible access to machinery while avoiding large capital expenditures. Rental penetration is estimated at 35–40% of the total market value in 2026.

The report highlighted several key trends shaping the market, including growing adoption of telematics, remote diagnostics, predictive maintenance systems, and operator-assist technologies aimed at reducing downtime and lowering total ownership costs. Electrification is also gradually entering the sector, particularly in forklifts, compact excavators, and logistics vehicles, although diesel-powered equipment is expected to dominate heavy construction and mining applications through 2030.

At the same time, supply chain bottlenecks, long lead times for heavy components, and shortages of skilled technicians continue to challenge the market, particularly for advanced telematics-equipped and electric vehicles.

Chinese manufacturers, including SANY, XCMG, and Zoomlion, are also expanding their regional presence through competitive pricing and flexible financing models. Their combined market share is projected to rise from around 15–20% in 2026 to as much as 25–30% by 2035.

Source: IndexBox