Elevators & Escalators Market

The elevators & escalators market is estimated to be USD 152.1 billion in 2023 and is projected to reach USD 207.4 billion by 2028, at a CAGR of 6.4% between 2023 and 2028. The elevators and escalators market is expected to witness significant growth in the coming years due to its increased demand across the residential, commercial and infrastructure industries.

Attractive Opportunities in the Elevators and Escalators Market

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Elevators and escalators Market Dynamics

Driver: Increased construction of high-rise buildings equipped with smart vertical transportation systems due to rapid urbanization

The substantial migration from rural to urban areas worldwide, particularly in Asia, Africa, and the Middle East, is driving rapid urbanization. According to the UN, urban populations are projected to reach 60% by 2030 and 68% by 2050. This shift is notable in Asia, where over 50% of the population resides in cities, with similar trends in Africa and the Middle East. While North America, Latin America, the Caribbean, and Europe have reached urbanization saturation, megacities like Tokyo, Mexico City, Seoul, and Lagos are emerging, necessitating advanced infrastructure, including efficient vertical mobility. This surge in urbanization and high-rise building construction is anticipated to boost the demand for elevators & escalators.

Restraint: High maintenance cost

In the elevators & escalator industry, implementing safety standards plays a very important role as lack of safety may lead to serious injuries or fatalities. Factors like unsafe practices, faulty design or product selection, and inadequate maintenance contribute to accidents. Maintenance challenges, including the level and cost, pose a significant hurdle for the industry. While elevators in the US handle billions of trips annually, there are around 30 reported deaths on average, highlighting the importance of accident prevention. Identifying aging equipment and non-compliant products is essential, but the associated costs serve as a constraint for market growth.

Opportunities: Development of innovative technologies and rising demand for smart elevators

Manufacturers are actively engaged in developing innovative technologies to set their products apart and maintain a competitive edge in the market. Smart elevators, controlled by advanced hardware and software systems, represent the next frontier in vertical transport. The increasing height of buildings highlights the importance of elevator speed to minimize waiting times, especially in high-rise structures. Future initiatives like 'housing for all' and the creation of smart cities necessitate taller buildings with more efficient mobility solutions. A notable example is The Burj Khalifa, which features the world's tallest service elevator, reaching an impressive 504 meters (1,654 ft). This architectural achievement aligns with the growing demand for smart elevators amid the demand for high-rise buildings, emphasizing the need for high-speed and energy-efficient elevator solutions.

Challenges:  Compliance with standards and regulations

The stringent regulations and standards imposed on elevators and escalators pose a potential limitation to the market. Adherence to these regulations is important, considering that even the smallest product defect could jeopardize user safety. Government bodies and non-profit organizations, including the American Society of Mechanical Engineers (ASME), Elevator and Escalator Safety Trust, Elevator Escalator Safety Foundation, and the Elevator Advisory Board, have established comprehensive rules and regulations to ensure public safety in the industry. Notably, the ASME has developed key codes addressing safety aspects in the design, installation, operation, inspection, testing, maintenance, alteration, and repair of elevators, escalators, moving walkways, and related equipment. The industry must comply with these regulations to maintain market share, as any malfunction could lead to accidents, impacting a company's profitability.

ECOSYSTEM

By Service, New installation Accounted for the Highest Market Share in 2022.

The new installation segment is projected to record the highest CAGR of 6.9% during forecast period. The demand for high-rise buildings, encompassing offices, malls, residential apartments, and hotels, signifies economic growth. Elevators & escalators are essential for efficient movement within these structures, facilitating access to different destinations. The increasing construction of new buildings directly drives the demand for elevators & escalators. Various types, including passenger, freight, hospital, and observation elevators, cater to diverse needs.

By End Use Industry, Commercial will be the Second Fastest-Growing Industry in Elevators and escalators market in 2022.

The commercial segment is estimated to account for the second largest share of the overall elevators and escalators market in 2022. The commercial sector encompasses offices, retail establishments, airports, hotels, and leisure parks. Over the next five years, there is anticipated growth in the construction of hotels, retail outlets, and entertainment units. Building owners in the commercial space are prioritizing energy efficiency and optimizing elevator traffic flow. Consequently, smart elevators are gaining popularity in commercial settings. In Europe, numerous airport projects, particularly in the Nordic countries, are in the planning stage. Similarly, various African countries are considering new airport construction to meet the increasing demands of developing nations.

Asia Pacific is projected to account for the highest CAGR in the elevators and escalators market during the forecast period.

APAC is estimated to be the largest market for elevators and escalators and is also projected to register the fastest CAGR of 7.4% during the forecast period. China is expected to account for the largest share of the market in APAC till 2028. Increasing global population and improving economic conditions of developing countries and demand for high-rise buildings are the main drivers for elevators and escalators market.

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Key Market Players

Elevators & escalators market comprises key manufacturers such as Schindler Group (Switzerland), Otis (US), KONE Corporation (Finland), Hitachi Ltd. (Japan), Hyundai Elevator Co. Ltd. (South Korea), Fujitec Co., Ltd.  (Japan), Toshiba Elevators and Building Systems Corporation (Japan), Mitsubishi Electric Corporation (Japan),  TK Elevator (Germany), SJEC Corporation (China), and others. Expansions, acquisitions, joint ventures, and new product developments are some of the major strategies adopted by these key players to enhance their positions in the elevators and escalators market.

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Scope of the Report

This research report categorizes the elevators and escalators market based on material type, end-use industry,  application, and region.

Based on Type:

• Elevator
• Escalator
• Moving Walkways

Based on Service:

• New installation
• Maintenance & repair
• Modernization

Based on Elevator Technology:

• Traction elevator
• Machine room less traction elevator
• Hydraulic

Based on End-use Industry:

• Residential
• Commercial
• Institutional
• Infrastructure
• Others

Based on region:

• North America
• Europe
• APAC
• Middle East & Africa
• South America

Recent Developments

• On February 2021, Schindler Group signed a partnership agreement with citizenM hotels, the leading Netherlands-based boutique hotel chain, to provide service and modernization for escalators and elevators in all of the Group’s existing buildings across the globe, as well as the installation of future vertical mobility solutions in the chain’s new hotels.
• On August 2020, Otis acquired Bay State Elevator to expand in the northeast US. The acquisition includes the company service portfolio and operations in Massachusetts, Connecticut, Vermont, and upstate New York.
• On October 2023, KONE Corporation has finalized the sale of its operations in Russia to S8 Capital, a diversified holding company based in Russia.
• On November 2022, KONE has concluded the buyback of its own class B shares, acquiring a total of 1,083,500 shares at an average price of USD 49.5 per share.
• On April 2022, Hitachi, Ltd. has declared the successful acquisition of all outstanding shares of Yungtay Engineering Co., Ltd. ("Yungtay"), a subsidiary based in Taiwan involved in the manufacturing, sale, and service of elevators and escalators. This strategic move aims to enhance Hitachi's elevator and escalator business presence in the People's Republic of China ("China") and other regions of Asia.

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