Heavy equipment manufacturers are bringing their bulldozers, backhoes and tractors to Las Vegas this week for North America’s largest construction trade show, but the mood for many is not celebratory.
The sector is producing less and employing fewer people than it did in 2022, according to a report from the Association of Equipment Manufacturers, released every three years at the triennial expo.
“The path that we are on is leading us to less manufacturing in the United States,” said Kip Eideberg, senior vice president of government and industry relations for the group.
Total sales and indirect economic output from the heavy equipment sector was $902 billion in 2025, a slight contraction from $905 billion in 2022. There’s a similar cooling trend in the labor market, with direct employment falling to 421,000 workers, from 423,000 three years prior, the report stated. Direct sales were basically flat at $265.76 billion last year, down from $266.64 billion in 2022 according to revised figures, the association said.
The New York Times obtained an advance copy of the report, which will be released Monday afternoon ahead of the CONEXPO-CON/AGG, which opens Tuesday.
The association cited several reasons for woes in the heavy equipment sector, including high interest rates and the phasing out of the Infrastructure Investment and Jobs Act. However, tariffs stand out as the key culprit.
“By and large right now, it is more economical to build a forklift overseas, import it and pay the tariff on the whole good than it is to import the parts and components that you need to build that forklift domestically,” Mr. Eideberg said.
Although the Supreme Court struck down some of the Trump administration’s tariffs last month, tariffs on steel and aluminum remain in place, alongside other levies. The White House did not reply to a request for comment about the fate of those tariffs.
A flood of government funding for roads, bridges and factories made available through the infrastructure bill and the CHIPS and Science Act, championed by former President Joseph R. Biden, led to a surge in growth for the heavy equipment industry in 2023.
The following year, however, demand cooled and sales and employment declined as farmers struggling with low prices for their crops purchased fewer machines. And sales of construction equipment sagged because fewer houses were built as higher interest rates impeded home buying. In 2025, tariffs added to those headwinds, causing the equipment industry to contract further.
The report, by S&P Global Market Intelligence, noted some bright spots for the sector, including favorable changes to the tax code, data center construction and a push to mine critical minerals in the United States. But it said heavy equipment manufacturers are likely to “continue to face meaningful constraints” from tariffs and immigration policies that make it harder to find workers.
Yet the industry plays an outsized role in the economy of many states. Texas led the country in heavy equipment employment, with more than 50,000 jobs, followed by Iowa, with more than 32,000. Wisconsin, Illinois, and Ohio each employed more than 25,000 people.
In some instances, it costs less to build in Asia and pay the tariffs to ship equipment to the United States because labor and materials costs are lower there, Hyster-Yale Inc., a Cleveland-based forklift manufacturer said in an email to The Times.
The company paid $40 million in tariffs last year. That led to a $27 million decline in operating profit on its forklift business compared to the previous year, according to its last quarterly earnings call. On that call, the company’s chief executive, Rajiv Prasad, said that it had initially held out hope for more demand in the second half of 2025 but that “optimism has faded largely due to the impact from tariffs on the market demand and on our costs.”
The company, which operates factories around the world, has pursued a core strategy of assembling forklifts in the markets where they are sold. But multiple layers of tariffs on inputs have made it even more expensive to build machinery on American soil, depressing demand for American-made goods.
About 30 percent of the heavy equipment made in the United States is exported. Of the nine countries listed as the top importers, only Mexico spent more last year than in 2024, according to the report. The increase was modest, at 2.3 percent. Every other country spent less on American heavy equipment. Countries with the steepest declines were the United Kingdom, which spent 35 percent less; Germany, about 29 percent less; and South Korea, 26 percent less.
Now that the Supreme Court has struck down tariffs imposed under the International Emergency Economic Powers Act, Hyster-Yale is pushing for more changes, such as no tariffs on imported components for companies that assemble in the United States and have “substantial domestic content.” It also called for new tariffs targeting foreign producers that enjoy “artificial advantages” like government subsidies.
Stephen Bullock, president of Power Curbers Companies, a Salisbury, N.C., manufacturer of equipment that creates roadside curbs, said fear of a trade war sparked by the administration’s tariffs keeps him up at night.
“If we impose a 20 percent tariff on India and they were to retaliate with a 20 percent tariff on our product, that would be crippling,” he said. “We have not seen that come to fruition, but it is still a serious threat.”
Farah Stockman is a Times business reporter writing about manufacturing and the government policies that influence companies that make things in the United States.
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