Dealers and lenders have been optimistic about the construction equipment market in 2025, but muted demand post-election and depreciation are raising concerns.
Dealers project used construction equipment sales to rise 7.8% in 2025, according to a Feb. 20 report by heavy-equipment research firm IronAdvisor Insights. Increased infrastructure projects are contributing to heightened expectations, Director of Research Jarrett Harris told Equipment Finance News.
“We’re seeing a fair amount of activity from the large aggregate producers of the world and paving contractors, specifically, for the types of machinery going into those applications,” he said. “Crushing, screening, asphalt pavers, things of that nature, I think those are the things that you can say, pretty clearly, are very positive right now.”
While homebuilding activity varies by region, infrastructure development is a relatively consistent driver of construction equipment demand, Harris said.
Equipment financiers are also seeing an uptick in large-ticket items, Jody Ray, relationship manager at Chicago-based BMO Bank North America, told EFN.
“I have personally seen the application volume increase for large-ticket pieces of equipment, machines $750,000-plus,” he said. “But my best indicator has been talking with owners, managers and dealer sales reps. They are seeing increased activity at their stores, with quotes for equipment keeping them busy.”
Where is post-election boost?
Many professionals in the heavy-equipment industry anticipated greater demand following November’s presidential election, as uncertainty over the outcome was resolved and pro-business policies were expected under President Donald Trump.
But demand has increased only marginally, according to the IronAdvisor report. While there may be “pro-growth policies” under the new administration, that doesn’t change near-term challenges, Harris said.
“There’s just a lot of things that this administration is tackling in the first 100 days, and we haven’t seen tax depreciation or an expediting of federal spending on infrastructure,” he said. “So, there’s just a lot of things I think people are hoping for. They just haven’t seen them yet.”
Trump’s tariff plans are also raising concerns, although they could have a positive impact on the industry, a John Deere dealer stated in the report.
“It’s really hard to say what will happen with this tariff thing,” the dealer said. “But I think you can pretty easily make the argument that tariffs — if they happen — will be good for used equipment. When you can’t build new tractors here, used equipment becomes a really good option.”
Prices still sliding
Dealers reported price declines between 2% and 25% for used construction equipment over a 90-day stretch ending Jan. 31 , according to the report. Dealers expect used prices to bottom out over the next three to nine months.
Positive trends in the construction market are creating reluctance to lower prices among OEMs and dealers, unlike the agriculture equipment sector, Harris said.
“I think there’s just a natural reticence,” he said. “We’re just not at the place in the construction market where things are as soft as they are in the ag market.”
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