OHR forecasts boost in rental

Over the next five years plant manufacturers and franchised dealers will become more involved in rental as hire continues to grow and equipment sales fall, delegates at the Construction Products Association Future of Plant Hire conference were told.

Speaker Colin Timms of Off-Highway Research said UK sales of construction equipment would fall from 36,500 units to a shade over 34,500 by 2007. Within the overall figure, he predicted a trend towards smaller equipment as the UK's infrastructure is mostly complete and much of the work is on repair and maintenance.

However, he expects mini excavator sales to fall 10% to 15%, a continuing decline in backhoe loader sales (to 6% of the market by 2007) and, despite a 30% increase over the last decade, skid steers will continue to struggle. Timms is predicting bright spots in telescopic rough terrain lift trucks, and access platforms.

Growth in construction equipment sales has been fuelled by hire companies and, in some areas like access platforms, all the sales are to rental companies, but their over-ordering has led to excess capacity and lower rates, concluded Timms. He added that rental will continue to grow (it is cost effective for contractors and transfers the service burden), rental ranges will broaden and modern machines will continue to be in demand.

While he said there is a future for small- and medium-size rental companies, he also predicted a growth of national and multi-national rental companies.