Back in 2011, the North American market was the second largest for construction equipment worldwide and had a revenue stream of about $25.8 billion. While that might seem like a big number, the election of President-elect Donald Trump has the potential to raise this number to new heights.
On the campaign trail, Trump promised to focus on massive infrastructure projects nationwide. He campaigned to improve roads, bridges, airports, schools, and hospitals. Even though Trump has yet to release the official details of this infrastructure plan, on the campaign trail he promised to put $1 trillion dollars back into the U.S. economy, with $550 billion worth of direct infrastructure investment alone. Plus, he is planning on giving a generous $137 billion in tax credits to profitable construction companies nationwide. So what does this mean for the North American construction industry?
Simple. Demand could soon be higher than ever!
Caterpillar for instance, benefited greatly from the election on November 8. The morning after the election, its stocks increased 7%, which made it the second best-performing stock on the Dow Jones. As a whole, Caterpillar shares have grown 35% this year, making it Dow's top gainer for 2016.
In fact, financial experts are claiming that infrastructure improvement could be the focal point of Trump's presidency.
Matt Schreiber, president of WBI a money management firm, explained to CNN Money his reasoning for supporting Trump. He said, "This would be great for the country, good for markets and good for American workers."
The earning potential for these projects is larger than many people realize, as a stimulus would have ripple effects on the larger economy. Trump has previously made comments about how he would consider using Caterpillar heavy equipment components to build his controversial border wall with Mexico. However, even if that idea never comes to fruition, the country still has dire need for plenty of other infrastructure projects.
This means that if you are in the construction industry, it is the perfect time to invest in your heavy equipment. If you're looking to upgrade your fleet, then consider used CAT parts and other types of heavy equipment components. From commercial engine cylinders to hardox steel plates, Long Island Heavy Equipment Parts Inc. is the best place to find the parts you need for your next project.