The first half of 2026 has brought a mixed set of signals for UK construction, but equipment sales have remained comparatively resilient. Construction Equipment Association chief executive Viki Bell draws on insights from leading market experts to examine what the latest figures reveal about demand, investment and the outlook for the rest of the year
Construction output grew by just 0.7% in 2025, supported mainly by repair and maintenance, while new work remained almost flat. During the first four months of 2026, total output was 1.7% lower than in the same period last year. Repair and maintenance increased by 5% but new work fell by 5.5%.
The Construction Products Association (CPA) has revised its forecast for 2026 from growth of 1.7% to a decline of 2.5%, with housing expected to see significant falls. The construction Purchasing Managers’ Index added to the subdued picture, dropping to 38.2 in May, its lowest level for six years.
Equipment sales defy the gloom
Equipment sales, however, have moved in the opposite direction. Figures reported by CEA market insights consultant Paul Lyons show that UK construction equipment sales during the first five months of 2026 were 4.2% ahead of the same period last year.
Wheeled loaders recorded the strongest growth, although from lower volumes than the largest categories. Mini and midi excavators, which account for the biggest share of sales, remained broadly level with last year, keeping overall growth to just over 4%.
Electric equipment also saw a strong pick-up during the first quarter, which continued through April and May. Higher diesel prices linked to the conflict in the Middle East were identified as a likely factor.
The figures do not point to a booming market, but they show that equipment demand is not simply following construction output downwards. Discussions with CEA members at Hillhead supported the picture of steady growth, although confidence about the second half of the year remained limited.
Why equipment sales and output are moving in different directions
Off-Highway Research has yet to revise its forecast of 2% growth in UK equipment sales this year, with recent discussions suggesting little change. Set against the CPA’s forecast of a 2.5% decline in construction output, the two measures are moving in different directions.
Analysis from Alex Woodrow, managing director of KGP Powertrain Intelligence, helps to explain why. High interest rates, inflation and supply chain pressures have limited expansion, making efficiency, total cost of ownership and replacement cycles increasingly important drivers of demand.
Even where businesses are cautious about expanding their fleets, replacing older machinery can still make commercial sense when newer equipment offers better productivity and fuel efficiency.
Imports and exports
UK equipment imports rose strongly in the first quarter of 2026, reaching their highest quarterly level since 2023, although volumes remain below the peaks recorded in 2022 and 2023.
Japan remained the leading source, accounting for 25% of imported tonnage. Together, Japan, China, Germany and France represented 61% of imports, while excavators accounted for more than 43%.
Exports also showed signs of recovery. The USA remained the leading destination, accounting for 25% of exports in the first quarter, up from 21% in 2025 and approaching the 26% share recorded in 2024. Excavators were the leading export product, while crushing and screening equipment accounted for a further 14.5%.
Tech shaping investment
Technology will continue to shape investment decisions as businesses seek to reduce fuel use, emissions and operating costs. Electric equipment is gaining ground, but the transition is more nuanced than a straightforward move away from diesel.
Off-Highway Research estimates that the global electric equipment market remained small in 2025, at around 2,500 machines. Around 85% of demand comes from mining, quarrying and industrial applications, where high utilisation, predictable working patterns and access to power can make the economics more attractive.
Chris Sleight, global managing director at Off-Highway Research, argues that the industry should focus on electrifying the application rather than simply the machine. Electric equipment can be well suited to indoor, underground, urban and other sensitive environments, offering lower noise and vibration and potentially reduced maintenance costs.
For many mainstream construction applications, however, charging infrastructure, grid capacity, purchase price and machine utilisation remain significant considerations.
The future is therefore unlikely to depend on one solution. Battery-electric machinery, hybrids, plug-in equipment, HVO-compatible engines and increasingly efficient combustion technology are all likely to have a role.
Construction activity remains under pressure, but equipment sales show that businesses will continue to invest where machinery offers clear improvements in productivity, efficiency and long-term value. The market is changing rather than disappearing, and the UK equipment sector remains more adaptable than the headline construction figures alone might indicate.
CEA CEO Viki Bell said: “While the wider construction figures show that conditions remain challenging, equipment sales tell a more positive and resilient story.
“Businesses are continuing to invest in machinery that can deliver greater productivity, efficiency and long-term value. The market is not standing still, and the figures show a sector that is adapting carefully and making considered investment decisions for the future.”
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