PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1359845
PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1359845
United States elevator and escalator market is valued at USD 19.49 billion in 2022 and is expected to reach USD 30.16 billion by 2030, growing at a CAGR of 5.61% during 2023-2030. The market in the United States is expanding for various reasons. The increased urbanization and desire for high-rise buildings have produced a demand for effective vertical transportation options. Technological advancements have resulted in the creation of innovative goods that are energy-efficient, cost-effective, and require a little upkeep. In addition, as the population ages, there is a greater demand for elevators and escalators in residential structures, hospitals, and elder living centers. Furthermore, the government's emphasis on sustainable infrastructure and the implementation of safety rules have aided expanding the elevator and escalator industry in the United States. Overall, the elevator and escalator market in the United States is anticipated to expand, driven by the increasing demand for efficient and safe vertical transportation solutions.
In 2022, maintenance and modernization activities in the United States elevator and escalator market comprised 75.2% and 24.8% of the total market share.
The Safety Code for Elevators and Escalators, ASME A17.1/CSA B44, sets the minimum elevator and escalator maintenance and inspection standards. In contrast, these standards can be supplemented by local laws or regulations as deemed necessary.
The elevator and escalator industry in the United States is experiencing growth driven by the increasing travel trends in several ways. The influx of tourists into the country has led to a higher demand for elevators and escalators in places such as hotels, airports, and public facilities. The tourism industry is a catalyst for new construction projects and the renovation of existing structures, often necessitating the installation of modern and efficient vertical transportation systems.
Moreover, as tourists expect quality and reliability regarding elevator and escalator systems, it places pressure on building owners and operators to invest in newer and improved equipment. According to the United States Hotel Construction Pipeline Trend Report by Lodging Econometrics, as of the second quarter of 2023, there are 5,572 projects in the hotel construction pipeline, comprising a total of 660,061 rooms. This represents a 7 percent increase in projects and a 6 percent increase in rooms compared to the previous year. As a result, the thriving tourism sector creates new opportunities for elevator and escalator manufacturers, installers, and maintenance companies in the United States.
The elevator and escalator market in the United States has witnessed significant growth, driven in large part by increased government investments in infrastructure development. As cities expand and populations grow, there is a corresponding rise in the demand for modern and efficient vertical transportation systems in various public, commercial, and residential settings. Government funding has been pivotal in meeting the heightened demand for elevators and escalators nationwide.
For example, the Biden administration has introduced a substantial infrastructure plan of USD 2 trillion by 2030, including significant public transportation allocations. It encompasses both the enhancement of existing infrastructure and the construction of new projects. Furthermore, the United States Department of Transportation has initiated a Notice of Funding Opportunity (NOFO) for USD 1.5 billion in grant funding as part of the 2023 Rebuilding American Infrastructure with Sustainability and Equity (RAISE) discretionary grant program. This widely employed program supports communities nationwide in executing projects with significant local or regional importance. The previous year, RAISE funding supported 166 projects covering all 50 states. Consequently, these investments are anticipated to create opportunities for elevator and escalator companies to offer services to these infrastructure developments.
Multifamily construction projects in the United States have significantly bolstered the demand for elevators. Population growth in the United States cities has fueled the need for more housing options. Multifamily construction projects have emerged as a popular solution to accommodate more residents within a smaller footprint. As these buildings rise in height, elevators become indispensable. Furthermore, urbanization has spurred high-density housing development in city centers, often featuring high-rise condominiums and apartments where elevators are essential for residents and tenants.
The demand for elevators has surged due to increasing multifamily housing construction projects. For instance, the United States multifamily housing sector experienced robust net unit absorption, reaching an impressive 70,200 units in the second quarter of 2023. The growth was supported by a strengthening job market, with at least 200,000 new jobs generated monthly as of 2023 and a steady 3.5% unemployment rate. Additionally, 91,400 newly constructed units were introduced during the same period, contributing to a cumulative total of 351,500 units over the past four quarters, marking a 2.1% increase compared to the previous year.
The COVID-19 pandemic significantly impacted the United States elevator and escalator market, leading to decreased demand, construction delays, and safety measures. Businesses closed or operated with reduced capacity, resulting in lower foot traffic in commercial buildings. Construction projects experienced delays due to lockdowns, supply chain disruptions, and labor shortages. Safety measures like reduced elevator capacity, frequent cleaning, and touchless controls were implemented to ensure passenger safety of affected system efficiency. Remote work reduced the need for daily commuting and office space, affecting elevator usage in office buildings. The pandemic accelerated the adoption of touchless technology in elevators and escalators, including contactless buttons, voice-activated controls, and UV disinfection systems, to address passenger safety concerns. These factors contributed to the market's resilience and adaptability.
Leading elevator companies in the United States are integrating technologies like IoT (Internet of Things) and AI (Artificial Intelligence) into elevators for several compelling reasons. For example, IoT sensors and AI algorithms can continuously monitor elevator systems, collecting data on parameters such as temperature, humidity, elevator speed, and motor performance. The data allows for predictive maintenance, identifying issues before they cause breakdowns, improving elevator reliability and reduced downtime. Elevator companies that integrate IoT and AI technologies can also differentiate themselves in the market. Buildings and property developers are increasingly seeking elevators with advanced features, energy efficiency, and predictive maintenance capabilities.
In 2022, the four leading vendors, Otis, TK Elevator, Schindler, and KONE, collectively hold a 55% share of the U.S. elevator and escalator market. During the fourth quarter of 2021, KONE unveiled a collaboration with Amazon Web Services (AWS). KONE will gain access to AWS's global cloud capabilities, encompassing analytics, and the Internet of Things (IoT).
Companies mentioned above DO NOT hold any order as per market share and can be changed as per information available during research work