Medium Duty Engines

Global Medium Duty Engines Market to Reach US$23.6 Billion by 2030

The global market for Medium Duty Engines estimated at US$17.9 Billion in the year 2024, is expected to reach US$23.6 Billion by 2030, growing at a CAGR of 4.7% over the analysis period 2024-2030. Class 4, one of the segments analyzed in the report, is expected to record a 4.5% CAGR and reach US$13.0 Billion by the end of the analysis period. Growth in the Class 5 segment is estimated at 5.0% CAGR over the analysis period.

The U.S. Market is Estimated at US$4.9 Billion While China is Forecast to Grow at 7.5% CAGR

The Medium Duty Engines market in the U.S. is estimated at US$4.9 Billion in the year 2024. China, the world`s second largest economy, is forecast to reach a projected market size of US$4.6 Billion by the year 2030 trailing a CAGR of 7.5% over the analysis period 2024-2030. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at a CAGR of 2.3% and 4.7% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 3.0% CAGR.

Global Medium-Duty Engine Market – Key Trends & Drivers Summarized

Why Are Medium-Duty Engines Critical for Transportation and Industrial Applications?

Medium-duty engines serve as the backbone of transportation, construction, agriculture, and industrial operations, offering the perfect balance between power, efficiency, and durability. Typically ranging from 4 to 9 liters in displacement and delivering 150 to 350 horsepower, these engines are widely used in medium-duty trucks, buses, delivery vehicles, construction equipment, and generators. Unlike heavy-duty engines designed for extreme workloads, medium-duty engines provide the versatility required for urban deliveries, vocational fleets, and light construction tasks while maintaining fuel efficiency and emissions compliance. The rising demand for electrification, fuel efficiency improvements, and alternative fuel adoption is reshaping the market, as industries seek cost-effective and sustainable solutions. With the expansion of e-commerce, last-mile delivery services, and urban infrastructure projects, the need for reliable and fuel-efficient medium-duty engines continues to grow. Additionally, governments worldwide are tightening emissions regulations, pushing manufacturers toward low-emission diesel, hybrid, and alternative fuel engines to meet evolving environmental standards.

How Are Technological Advancements Transforming Medium-Duty Engines?

The medium-duty engine market is undergoing a technological shift, driven by innovations in fuel efficiency, emissions control, and hybrid-electric powertrains. One of the most significant advancements is the integration of electronic fuel injection (EFI) and turbocharging, which enhances power output while reducing fuel consumption. The adoption of exhaust gas recirculation (EGR), selective catalytic reduction (SCR), and diesel particulate filters (DPFs) has further improved emissions performance, helping engines meet stringent regulations such as Euro VI, EPA 2027, and China 6. Additionally, the rise of alternative fuels, including natural gas, propane, and hydrogen, is gaining traction, providing cleaner-burning options for fleet operators. Hybrid and mild-hybrid engine technologies are also making inroads, combining internal combustion engines (ICE) with electric motors to enhance fuel efficiency and reduce carbon footprints. The electrification of medium-duty trucks is another game-changing trend, with battery-electric and hydrogen fuel cell engines emerging as viable alternatives in urban transport and logistics. With smart diagnostics, IoT-based predictive maintenance, and over-the-air (OTA) software updates, modern medium-duty engines are becoming more connected and intelligent, reducing downtime and improving overall fleet performance.

Which Industries and Applications Are Driving Demand for Medium-Duty Engines?

The demand for medium-duty engines spans multiple industries, each requiring efficient, durable, and versatile power solutions. The transportation sector is the largest consumer, with applications in delivery trucks, refuse vehicles, school and transit buses, and vocational trucks such as dump trucks and utility vehicles. The growth of e-commerce and last-mile delivery has particularly fueled demand for medium-duty engines in fleets of box trucks and step vans, where reliability and fuel efficiency are crucial. The construction and infrastructure sector also relies heavily on medium-duty engines to power excavators, loaders, concrete mixers, and cranes, ensuring smooth operation on job sites. In agriculture, these engines are widely used in tractors, combines, and irrigation systems, providing farmers with efficient and durable machinery. Additionally, the power generation industry utilizes medium-duty engines in backup generators, off-grid power systems, and mobile energy solutions, supporting hospitals, data centers, and remote locations. With the push toward cleaner transportation and industrial operations, the adoption of alternative fuel and hybrid medium-duty engines is accelerating across all these sectors.

What Factors Are Driving the Growth of the Medium-Duty Engine Market?

The growth in the medium-duty engine market is driven by several key factors, including increasing urbanization, expansion of logistics and e-commerce, and tightening emissions regulations. As cities expand and demand for efficient goods transportation rises, fleet operators are investing in fuel-efficient and low-emission medium-duty trucks, boosting demand for next-generation engines. The electrification of medium-duty vehicles is another major driver, with battery-electric and fuel-cell-powered engines gaining market share in response to zero-emission vehicle (ZEV) mandates and government incentives for clean energy fleets. The transition to alternative fuels, such as compressed natural gas (CNG), liquefied natural gas (LNG), propane, and hydrogen, is reshaping the industry as companies seek to reduce fuel costs and meet sustainability goals. Additionally, advancements in connected vehicle technology, including real-time engine diagnostics, AI-driven maintenance, and fleet optimization software, are enhancing the reliability and efficiency of medium-duty engines. The rise of autonomous and semi-autonomous commercial vehicles is also influencing engine design, with manufacturers developing smarter, more efficient propulsion systems. Emerging markets in Asia-Pacific, Latin America, and the Middle East are witnessing rapid infrastructure development and industrial expansion, creating strong demand for durable and high-performance medium-duty engines. With continued investments in clean energy, electrification, and digitalization, the medium-duty engine market is set for sustained growth in the coming years.

SCOPE OF STUDY:

The report analyzes the Medium Duty Engines market in terms of units by the following Segments, and Geographic Regions/Countries:

Segments:
Vehicle Class (Class 4, Class 5, Class 6); Horsepower (Below 150 HP, 150 HP - 250 HP, Above 250 HP); Distribution Channel (OEM, Aftermarket); End-Use (Construction machinery, Agricultural machinery, Commercial vehicles, Special vehicles)

Geographic Regions/Countries:
World; United States; Canada; Japan; China; Europe (France; Germany; Italy; United Kingdom; Spain; Russia; and Rest of Europe); Asia-Pacific (Australia; India; South Korea; and Rest of Asia-Pacific); Latin America (Argentina; Brazil; Mexico; and Rest of Latin America); Middle East (Iran; Israel; Saudi Arabia; United Arab Emirates; and Rest of Middle East); and Africa.

Select Competitors (Total 43 Featured) -

• Ashok Leyland
• Caterpillar Inc.
• CNH Industrial
• Cummins Inc.
• Daimler Truck AG
• DEUTZ AG
• Eicher Motors Limited
• Ford Motor Company
• General Motors Company
• Hino Motors, Ltd.
• Hyundai Motor Company
• Isuzu Motors Limited
• MAN Truck & Bus SE
• Navistar International Corp.
• PACCAR Inc.
• Scania AB
• Tata Motors Limited
• Volvo Group
• Wärtsilä Corporation
• ZF Friedrichshafen AG

TARIFF IMPACT FACTOR

Our new release incorporates impact of tariffs on geographical markets as we predict a shift in competitiveness of companies based on HQ country, manufacturing base, exports and imports (finished goods and OEM). This intricate and multifaceted market reality will impact competitors by artificially increasing the COGS, reducing profitability, reconfiguring supply chains, amongst other micro and macro market dynamics.

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We expect this chaos to play out over the next 2-3 months and a new world order is established with more clarity. We are tracking these developments on a real time basis.

As we release this report, U.S. Trade Representatives are pushing their counterparts in 183 countries for an early closure to bilateral tariff negotiations. Most of the major trading partners also have initiated trade agreements with other key trading nations, outside of those in the works with the United States. We are tracking such secondary fallouts as supply chains shift.

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APRIL 2025: NEGOTIATION PHASE

Our April release addresses the impact of tariffs on the overall global market and presents market adjustments by geography. Our trajectories are based on historic data and evolving market impacting factors.

JULY 2025 FINAL TARIFF RESET

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