The UAE elevator and escalator market will grow at a compound annual growth rate (CAGR) of 3.9 percent from 2016 to 2022, according to 6Wresearch, a leading market intelligence, and advisory center.
UAE is the second-largest construction market in the GCC region after Saudi Arabia, and the construction market in the UAE contributed nearly 11 percent to the country's gross domestic product (GDP) in 2015 and is further estimated to achieve 12 percent by the end of 2016, said a statement.
Government spending on improvising public infrastructure is leading to the growth of the construction industry in the country, and the expansion in the areas of metro network and airport has led to the installation of elevators and escalators in UAE, it said.
The UAE elevator and escalator market are highly consolidated with few players accounting for major volume share. Although the market in UAE remained stagnant in the last few years, with falling oil prices, the market is expected to decline due to halt in various government projects, said a statement by 6Wresearch.
In 2015-16, several infrastructure projects are anticipated to be on hold owing to the dismay of investments. Though the upcoming World Expo in 2020 is forecast to elevate major construction projects in the coming years, it added.
Prijo Samuel, senior research analyst, research and consulting, 6Wresearch, said: "In the vertical market, commercial vertical comprising of government and transportation, banking, financial and commercial offices accounted for the largest share in revenue terms followed by residential and industrial verticals, respectively."
"Additionally, the upcoming World Expo would result in an influx of tourists from across the globe, thus driving the construction of new hotels, malls, and expansion of metro networks and airports. These infrastructures would deploy elevators and escalators, which would provide the necessary boost to the overall market," he added.
Akash Shukla, research associate, research and consulting, 6Wresearch, said: "The growth of elevator and escalator market in UAE is driven by new installations followed by maintenance and modernization."
"Vast public infrastructure and commercial projects are expected to spur the demand for new elevators and escalators in the country," he said.
"Moreover, amongst all regions, the Southern region consisting of Abu Dhabi would register growth over the next six years. Further, several projects are under work-in-progress and are funded by Abu Dhabi Investment Authority (ADIA), which is pushing the construction in the region," he added. - TradeArabia News service.
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Media Courtesy : Trade Arabia