Small Gas Engine Market Report 2026

The small gas engine market size has grown steadily in recent years. It will grow from $3.05 billion in 2025 to $3.18 billion in 2026 at a compound annual growth rate (CAGR) of 4.4%. The growth in the historic period can be attributed to growth in construction activities, expansion of gardening equipment usage, demand for portable generators, infrastructure development, industrial mechanization.

The small gas engine market size is expected to see steady growth in the next few years. It will grow to $3.76 billion in 2030 at a compound annual growth rate (CAGR) of 4.3%. The growth in the forecast period can be attributed to urban landscaping demand, infrastructure modernization, adoption of cleaner gas fuels, growth in small-scale construction, increased emergency power needs. Major trends in the forecast period include compact engine design innovation, fuel flexibility enhancement, emission reduction technologies, rising demand for portable equipment, durability improvements for industrial use.

Rising construction activity is expected to drive the growth of the small gas engine market in the coming years. Rising construction activity refers to the increasing development, renovation, and expansion of residential, commercial, and infrastructure projects worldwide. This growth is primarily driven by accelerating urbanization, which is boosting demand for housing, commercial spaces, and public infrastructure. The small gas engine market supports construction activity by providing reliable power solutions for construction-related outdoor equipment, such as generators and material-handling tools used across project sites. For example, in March 2023, Global Construction 2030 projected that global construction output would grow by 85% to reach $15.5 trillion by 2030, led by strong expansion in China, India, and the United States. Consequently, rising construction activity is fueling the growth of the small gas engine market.

Major companies in the small gas engine market are focusing on developing innovative solutions, such as the New-Tech Small Turbine Engine Program, to enhance their market competitiveness. The New-Tech Small Turbine Engine Program is an initiative aimed at developing advanced small turbine engines that incorporate new and innovative technologies. The program is designed to meet the specific needs of the military for unmanned aerial vehicles, reconnaissance aircraft, and other smaller platforms where compact, powerful, and reliable engines are essential. For example, in June 2023, Rolls-Royce, a UK-based engineering company known for its aerospace, defense, marine, and energy products and services, launched the New-Tech Small Turbine Engine Program. These engines are typically small in size and are used in aircraft, drones, and other specialized vehicles or machinery, combining compact design with high performance and reliability.

In September 2024, Yanmar Energy System Co., Ltd., a Japan-based industrial equipment manufacturer, acquired TEDOM Group for an undisclosed amount. The acquisition aims to strengthen Yanmar's presence in the energy sector by combining TEDOM's expertise in cogeneration and energy services with Yanmar's global reach and innovative technologies, fostering sustainable growth and innovative solutions for customers. TEDOM Group, based in the Czech Republic, specializes in the development and production of combined heat and power (CHP) units and energy solutions.

Major companies operating in the small gas engine market are Briggs and Stratton Corporation, Kohler Co., Honda Motor Co. Ltd, Yamaha Motor Corp., Kawasaki Heavy Industries, Kubota Corporation, Kipor Power, Champion Power Equipment, Generac Power Systems Inc., Fuji Heavy Industries Ltd., Fuzhou Launtop M&E Co. Ltd., Liquid Combustion Technology LLC, Lifan Power USA, Zongshen Power, Subaru Corporation, Sinoquip Power, Chongqing Winyou Power Co. Ltd., Lombardini Srl, Wuxi Kipor Power Co. Ltd., Jiangsu Excalibur Power Machinery Co. Ltd., Changzhou ETK Power Machinery Co. Ltd., Taizhou Genour Power Machinery Co. Ltd., Tecumseh Products Company, Robin America Inc., Mitsubishi Heavy Industries Engine & Turbocharger Ltd., Loncin Industries Ltd., Koki Holdings Co. Ltd., SAE Manufacturing Specialties Corp., Triton Duro Power Systems Inc., Performance Assembly Solutions, Central Diesel Inc., Sage Parts.

North America was the largest region in the small gas engine market in 2025. The regions covered in the small gas engine market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the small gas engine market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The small gas engine market consists of sales of 2-stroke and 4-stroke engine. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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