SMALL ENGINE MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2025-2032)

Small Engine Market Size and Forecast – 2025-2032

The global small engine market is expected to hold USD 19.34 Bn in 2025 and reach at USD 24.77 Bn by 2032, exhibiting a compound annual growth rate (CAGR) of3.6% from 2025 to 2032.

Key Takeaways

• Based on Engine Type, the Horizontal Engines segment is expected to lead the market with 53.3% shares in 2025, owing to its suitability for power tools and outdoor power equipment.
• By Fuel Type, the Gasoline Engines segment is expected to account approximately 77.4% shares in 2025, owing to their widespread availability and ease of use.
• North America is the largest market, and is expected to account for 32.60% of the market share in 2025.
• Asia Pacific, holding a share of 23.6% in 2025, is projected to show the fastest growth.

Market Overview

The global small engine market has been witnessing significant growth over the past few years. The residential sector, comprising lawn mowers and other garden equipment, held majority of the market share. Some of the main reasons why small engine sales are going up are more people moving to cities and more people spending money on lawn and garden tools. But strict rules about emissions from gasoline-powered equipment and a growing interest in battery-powered options are likely to make it harder for the market to grow in the next few years.

Current Events and Its Impact

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Small Engine Market – Pricing Analysis

Micro Engines (25-50cc)

• Entry-level residential applications
• Price range: $89-$245
• Primary use: Leaf blowers, small chainsaws, string trimmers

Small Engines (51-150cc)

• Mid-range residential to light commercial
• Price range: $180-$485
• Primary use: Lawn mowers, generators, pressure washers

Medium Engines (151-300cc)

• Heavy residential to commercial applications
• Price range: $385-$850
• Primary use: Riding mowers, larger generators, commercial equipment

Large Small Engines (301-500cc)

• Commercial and industrial applications
• Price range: $650-$1,450
• Primary use: Zero-turn mowers, industrial generators, agricultural equipment

Segmental Insights

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Small Engine Market Insights, by Engine Type – Horizontal Engines Experience Huge Demand in Power Tools and Equipment

In terms of engine type, the horizontal engines segment is expected to contribute the highest share of 53.3% in the market in 2025 owing to its suitability for power tools and outdoor power equipment.

Horizontal engines are preferred for applications that require compact size and lightweight power solutions. Their flat, cylindrical design makes them ideal for power equipment like lawnmowers, chainsaws, generators, and tillers where efficiency of operation is crucial in limited spaces.

For example, in August 2024, Briggs & Stratton launched the Vanguard 300, a 307cc, 10.0 Gross HP* single-cylinder horizontal shaft engine. Built for superior performance, durability, and reduced maintenance, it delivers lower total cost of ownership.

Small Engine Market Insights, by Fuel Type – Gasoline Engines Lead Due to Widespread Availability

In terms of fuel type, the gasoline engines segment is expected to contribute the highest share of 77.4% in the market in 2025 owing to their widespread availability and ease of use. Being simpler in design compared to diesel engines, gasoline engines are lighter and more affordable. The fuel itself is also easily procured globally at retail fuel stations.

Gasoline has a higher energy density than other fuels, allowing it to store more energy in a smaller fuel tank. This quality makes gasoline ideal for small engines used in lawnmowers, chain saws, portable generators, and tillers where continuous operation and convenience of refueling is critical.

In July 2025, Mitsubishi Heavy Industries Engine & Turbocharger, Ltd. (MHIET), a subsidiary of the Mitsubishi Heavy Industries (MHI) Group, introduced a new addition to its SGP M450 gas cogeneration system lineup. Developed in collaboration with Toho Gas Co., Ltd., the system supports hydrogen co-firing of up to 15% by volume and delivers a power output of 450 kW.

Regional Insights

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North America Small Engine Market Trends

North America is expected to dominate the small engine market revenue, holding a share of 32.60% in 2025. The region’s market dominance can be attributed to factors such as a well-established lawn and garden equipment industry and the high consumer demand for outdoor power equipment. Supportive government regulations toward emission standards, such as the Environmental Protection Agency (EPA) Phase 3 Emission Standards, also provide a conducive business environment for key players in the region.

Asia Pacific Small Engine Market Trends

The Asia Pacific region, holding a share of 23.6% in 2025, is expected to exhibit the fastest growth, driven by the rapidly increasing industrial and commercial activities along with the expanding consumer base. Population growth and urbanization are expected to propel the demand for various machinery and construction equipment that use small engines.

Small Engine Market Outlook for Key Countries

U.S. Small Engine Market Trends

The U.S. small engine market is primarily driven by the widespread use of lawn care equipment, portable generators, and construction machinery, with consumers demanding durable and high-performance engines. Key players like Briggs & Stratton, Honda, and Kohler dominate the industry, investing heavily in research and development to enhance fuel efficiency, reduce emissions, and integrate smart technology.

Alongside these global giants, local manufacturers and suppliers play a crucial role in aftermarket services, offering replacement parts and maintenance solutions that support the longevity of small engines. With a strong DIY culture and professional landscaping services contributing to demand, the U.S. remains a key market for small engine innovations.

For instance, in June 2025, GE Aerospace announced a formal teaming agreement with Kratos Defense & Security Solutions, Inc., to advance propulsion technologies for the next generation of affordable unmanned aerial systems and CCA-type aircraft. Such developments are proliferating the small engine market share.

China Small Engine Market Trends

The China small engine market is fueled by its role as a major global manufacturing hub, providing cost-effective solutions for agricultural, construction, and industrial applications. Local manufacturers, such as Changfa and Lifan, leverage their cost advantages and economies of scale to compete with international brands, catering to both domestic and export markets.

For instance, in June 2024, Caterpillar Inc. announced that it will produce advanced small and medium-sized diesel engines in Wuxi, Jiangsu Province, China. 

Japan Small Engine Market Trends

Japan continues to be a leader in the small engine market, known for its advanced technological expertise and precision engineering. Industry leaders like Yamaha and Kawasaki set global quality benchmarks with their diverse and reliable engine portfolios, catering to applications ranging from motorcycles to industrial equipment.

For instance, in June 2024, In Japan, original equipment manufacturers (OEMs) Mazda Motor Corporation (Mazda), Subaru Corporation (Subaru), and Toyota Motor Corporation (Toyota) have each committed to developing new engines tailored to electrification and the pursuit of carbon neutrality.

Germany Small Engine Market Trends

The Germany small engine market has gained momentum through innovative engineering solutions tailored for industrial and off-road applications. With a strong emphasis on efficiency, performance, and environmental sustainability, the market benefits from advancements in diesel and hybrid engine technology.

For instance, in July 2024, TAFE Motors and Tractors has announced a “cooperation” with German company DEUTZ for manufacturing engines.

Market Players, Key Development, and Competitive Intelligence

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Key Developments

• In September 2025, Honeywell unveiled a new small-thrust-class engine, the HON1600, for the collaborative combat aircraft (CCA) and unmanned aircraft system (UAS) market during the annual Air, Space & Cyber Conference organized by the Air & Space Forces Association in Washington, D.C.
• In September 2025, Kratos Defense & Security Solutions, Inc.  and GE Aerospace announced that they have started altitude testing on its GEK800 small engine designed to power the next generation of affordable unmanned aerial systems and CCA-type aircraft.
• In October 2024, Kawasaki Heavy Industries, Ltd., a manufacturer of motorcycles, equipment, and engines, carried out the successful operational test of a small, 100% hydrogen-fueled aircraft engine. This test was conducted as part of hydrogen aircraft core technology development efforts for a next-generation aircraft development project by the New Energy and Industrial Technology Development Organization (NEDO) Green Innovation Fund.
• In July 2024, GE Aerospace, an aircraft engine supplier, partnered with Kratos Turbine Technologies, a producer of jet engines, for the development of small engines to potentially power unmanned Aerial Systems (UAS), collaborative combat aircraft, and similar applications

Emerging Startups - Small Engine Industry Ecosystem

• Innovative Technologies: Startups like SparkE are developing Bluetooth-enabled smart sensors to monitor small engine performance via mobile apps, enabling predictive maintenance. AutoM8 focuses on AI and computer vision algorithms to automate small engine manufacturing processes for higher quality and lower costs. Such advanced technologies could facilitate condition-based monitoring for off-road vehicles and help reduce downtime.
• Sustainable Solutions: Startups like PBC Linear are commercializing technology to convert non-recyclable plastics into biofuel. This offers an eco-friendly fuel alternative for small engines. Other startups are designing multi-fuel engines optimized to run on renewable sources as well as recycled materials in components. Their innovations may aid in transitioning the industry towards more environmentally sustainable practices.
• Market Contribution: New ventures often form the link between technological advancements and real-world impact. By joining incubators and accelerators, startups receive funding and mentoring support needed to refine ideas. They may then partner with global industry players to test pilots and demonstrate applications.

Market Report Scope

Small Engine Market Report Coverage

Market Dynamics

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Global Small Engine Market Driver - Growth in construction and infrastructure development

The construction and infrastructure development sector has witnessed significant growth particularly in developing regions of the world over the past decade. Both residential as well as commercial construction activities have increased manifold in countries such as China, India, and several Southeast Asian countries on the back of rapid urbanization and growing populations. This has driven higher demand for earthmoving and material handling equipment that utilize small engines.

Equipment such as excavators, backhoe loaders, concrete mixers, cranes, and forklifts require reliable and durable small engines with optimum power and fuel efficiency to perform repeated heavy-duty operations on construction sites. Furthermore, infrastructure development projects related to roadways, railroads, highways, bridges, and other public utilities also incorporate small engine-based machinery for various onsite tasks.

Global Small Engine Market Opportunity - Development of hybrid and electric small engines for market

The development of hybrid and electric small engines present a major opportunity for players in the global small engine market. With growing environmental concerns, consumers are looking for green and sustainable power solutions. Hybrid and electric small engines aim to address the emission issues by replacing the conventional internal combustion engines.

The successful development of these new technologies for commercial use can unlock new revenue streams. Early investments and partnerships across the hybrid and electric small engine value chain will help companies gain a foothold in this promising segment.

Governments and regulations also increasingly support the usage of zero or low emission engine technologies. If costs come down, hybrid and electric small engines could see rising demand for applications like lawn mowers and recreation vehicles. Their market growth helps reduce dependency on fossil fuels and deliver on sustainability goals.

Analyst Opinion (Expert Opinion)

• The small engine market is poised for steady growth, driven by increasing demand in construction and gardening applications. Manufacturers are focusing on developing fuel-efficient and environmentally friendly engines to meet regulatory standards and consumer preferences.
• Challenges such as stringent emission regulations and competition from alternative power sources like electric motors may hinder market growth. However, these challenges also present opportunities for innovation in hybrid and cleaner engine technologies.
• The North America is expected to witness significant growth due to rapid industrialization and urbanization, leading to increased demand for small engines in various applications.

Market Segmentation

• Engine Type Insights (Revenue, USD Bn, 2020 - 2032)
• Horizontal Engines
• Vertical Engines
• Fuel Type Insights (Revenue, USD Bn, 2020 - 2032)
• Gasoline Engines
• Diesel Engines
• Regional Insights (Revenue, USD Bn, 2020 - 2032)
• North America
• U.S.
• Canada
• Latin America
• Brazil
• Argentina
• Mexico
• Rest of Latin America
• Europe
• Germany
• U.K.
• Spain
• France
• Italy
• Russia
• Rest of Europe
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• ASEAN
• Rest of Asia Pacific
• Middle East
• GCC Countries
• Israel
• Rest of Middle East
• Africa
• South Africa
• North Africa
• Central Africa
• Key Players Insights
• Briggs & Stratton
• Honda Motor Co. Ltd.
• Yamaha Motor Co. Ltd.
• Kawasaki Heavy Industries Ltd.
• Kohler Co.
• Kubota Corporation
• Yanmar Co. Ltd.
• Generac Holdings Inc.
• Lifan Power USA
• Mitsubishi Heavy Industries Ltd.
• Tillotson Ltd.
• Hatz Diesel
• Chongqing Fuchai
• Changchai Co. Ltd.
• Subaru Industrial Power Products

Source

Primary Research Interviews

• Small Engine Manufacturers (Honda, Briggs & Stratton, Kohler)
• Equipment OEMs (John Deere, Husqvarna, STIHL)
• Distributors and Dealers
• End-users (Landscaping Companies, Agricultural Operators)
• Others

Databases

• IBISWorld Industry Research Database
• Euromonitor International
• Bloomberg Terminal
• Others

Magazines

• Power Equipment Trade Magazine
• Outdoor Power Equipment Magazine
• Small Engine Technology Magazine
• Equipment World Magazine
• Others

Journals

• International Journal of Engine Research
• SAE International Journal of Engines
• Applied Energy Journal
• Others

Newspapers

• Wall Street Journal
• Financial Times
• Reuters Business News
• Bloomberg News
• Others

Associations

• Outdoor Power Equipment Institute (OPEI)
• Engine Manufacturers Association (EMA)
• Small Engine Manufacturers Association (SEMA)
• International Association of Machinists and Aerospace Workers
• Others

Public Domain Sources

• U.S. Environmental Protection Agency (EPA) Reports
• U.S. Census Bureau Manufacturing Data
• European Commission Industrial Statistics
• International Energy Agency Publications
• Others

Proprietary Elements

• CMI Data Analytics Tool
• Proprietary CMI Existing Repository of information for last 8 years