Latin America Elevator and Escalator Market Size & Growth Forecast 2023-2029

MARKET OVERVIEW

The Latin America elevator and escalator market by new installations accounted for 36.6 thousand units in 2022 and is expected to reach 46.8 thousand units by 2029 growing at a CAGR of 3.51% during the forecast period. Migration and rising demand for vertical cities have paved the way for the development of the elevator and escalator market, which is also related to the evolution of the construction sector. Further, rapid urbanization, housing deficit, and government initiatives to attract foreign conglomerates for trade and business have contributed to the growth of Latin America elevator and escalator markets.

By the installed base, the Latin America elevators market is expected to reach 1,062.2 thousand units by 2029. Brazil remains to be the largest installed base in the Latin American Region. Still, Brazil's elevator density stands fourth in terms of elevator density, with 1.9 elevators for 1,000 people in Brazil.

KEY HIGHLIGHTS

Technological innovation and safety aspects like sky bridges, modular construction, and cybersecurity adoption in buildings propel the demand for intelligent elevator systems.

• The urgent need for housing in Chile has prompted the Housing and Urban Development Ministry (MINVU) to develop an urban housing strategy. With an estimated housing deficit of approximately 650,000 units, the strategy aims to address this issue by delivering 260,000 homes by March 2026, covering at least 40% of the projected need. One of its key objectives is to restore the State's central role in housing planning and management.
• In Colombia, the International Finance Corporation (IFC) collaborated with the Colombian Chamber of Construction (CAMACOL) to promote EDGE certification, providing a platform for designing and certifying green and zero-carbon buildings as of 2021. Colombia's five commercial banks offer green financial products in the construction sector, making it one of the region's most empowering financial environments for green building investment. Colombia already has 168,000 homes built with EDGE certification, with 120,000 additional homes underway at the end of 2022.
• 3D Printing is emerging as a key technology to provide eco-friendly and affordable construction, but its adoption requires a standard shift in the construction industry. While additive manufacturing in Latin America has yet to grow significantly, a consortium called CONMAD was developed in 2018 to promote the technology. The largest modular hospital in Latin America, spanning 140,000 ft², was constructed in just 60 days in Rio de Janeiro to treat patients infected with COVID-19. The project involved over 500 workers and included 300 beds and 120 ICUs divided into four modules.
• Regarding equipment, the majority (79%) is imported from China, with 1% from Europe and 20% manufactured in Columbia. While most spare parts are imported, mechanical components are primarily produced within the country. The U.S.-Colombia Trade Promotion Agreements have facilitated the importation of road and construction equipment duty-free, along with services such as project management, bridge design, architecture, and engineering. The agreement also provides legal protections for U.S. companies, expanded access to the services market, and improved dispute settlement mechanisms.
• The United States-Mexico-Canada Agreement (USMCA) will bring abundant opportunities for constructing new manufacturing and industrial plants, which shall be a key factor in enhancing investment and supply chain to Mexico.

Rising Urban Population in Metropolises and Housing Deficit to Hike Elevator Demand

• Green and Yellow House’ is a program initiated to build 12 million housing units, of which 384,000 were given to socially vulnerable populations, around 1.5 million in Brazil.
• As of May 2023, according to Chile's Housing and Urban Development, 133,855 dwellings are being built, 74,866 have been approved, and the work is almost complete. This indicates that as of May 2023, 259,038 dwellings had been awarded a subsidy, considering the total number of completed housing solutions, those under construction, and those approved to start construction.
• Argentina plans to construct nearly 300,000 homes in the next decade, particularly emphasizing commercial buildings driven by the country's tourism industry. Moreover, Argentina offers a cost advantage compared to neighboring countries like Uruguay and Brazil, where building expenses are almost double.
• The housing deficit in most Latin American countries is due to urban sprawl since most migrated people live in remote areas on hills called favelas. Due to this, the national governments have introduced various housing initiatives to cope with the demand. These necessary actions will boost the demand for elevators in the Latin American elevator and escalator market.

Increased Infrastructure Investments Due to Reduced Tax and Service Platform Authorization Directed to Surge in New Installations in the Latin America Elevator and Escalator Market

• In June 2023, tax incentives were announced to attract companies to invest in Mexio’s business corridor, aiming to compete with the Panama Canal. These incentives include a 50% reduction in income tax for three years, with a potential 90% discount if employment goals are met. The measures also include accelerated depreciation of investments and value-added tax (VAT) exemptions. The government plans to construct ten industrial parks along the corridor, with a tender for their location launching in mid-June 2023.
• During 2016-2018, when the platform gov.br service did not exist, only 21 requests to open a branch from foreign companies were registered. However, after introducing the platform, 118 authorization requests were registered, of which 92 have been authorized to open branches in Brazil. Due to this service platform, authorization to work has also been granted in digital ways in a span of 3 days.

Maintenance Market Pushed Digital Seal By ABEEL

• Brazilian Association of Elevator Companies (ABEEL) introduced a digital seal for elevator companies to distinguish companies based on meeting current standards, quality of products, commitment, and customer service. Through digital seal, companies can top out by getting certified by an independent consulting company, SW - inteligência em negócios. After meeting all the requirements, companies are provided with a QR code that exhibits all the company's related information when scanned.
• According to ABEEL, the modernization of elevators leads to secondary consequences (reduced maintenance costs of elevators), stabilizing the economy for condominiums. Old elevators, which require extra attention and additional costs, lead to an increase in the costs of buildings.

VENDOR LANDSCAPE

• Otis, Schindler, TK Elevator, and KONE are the top 4 manufacturers of the Latin America elevator and escalator market, with a share of over 64%.
• The Latin America launch of the Otis eCall PlusTM app, which offers passengers a contactless intelligent solution to call elevators remotely, Otis Mexico conducted the first regional demonstration of the product installed at the Avalanz Tower in Monterrey, Nuevo León. Avalanz Tower is the fifth tallest skyscraper in San Pedro Garza García and one of the city's most well-known buildings.