Construction Equipment Rental Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)


Posted April 19, 2021 by Statzyreports

The construction equipment rental market was valued at USD 103 billion in 2020, and it is expected to register a CAGR of 4.78% during the forecast period (2021-2026).
 
The construction equipment rental market was valued at USD 103 billion in 2020, and it is expected to register a CAGR of 4.78% during the forecast period (2021-2026).

The outbreak of pandemic COVID-19, impacted the demand for construction equipment rental market globally, as the construction activities were halted during the lockown period in order to maintain the social distancing norms and contain the spread of virus. However, with the gradual opening of economied the demand is gaining back momentum as inorder to get the growth in GDP back on track the governments are increasing their spending in construction activities which will increase the demand during the forecast period.

One of the major factors driving the growth of the market is the growing construction industry, especially in developing countries, owing to numerous growth opportunities in infrastructure, residential, and non-residential sectors. For instance, the rise in construction of multi-family houses (with the growing trend of nuclear families), and increasing investments in the construction of roads, highways, smart cities, metros, bridges, and expressways due to growing population and urbanization.

The growing trend toward automation is expected to drive the growth of the market. However, factors, such as stringent emission regulations for construction machinery, are expected to hinder the growth of the market.

Key Market Trends

Increasing Investments in the ASEAN Construction Industry

The construction industry is highly dynamic, and numerous factors, such as overall economy, budgets, and global economic scenario, are influencing the market’s growth. Volatility in these aspects affects the businesses of construction equipment OEMs, as well as construction rental equipment. This, in turn, is leading to price fluctuations of new, used, and rental equipment.

The ASEAN region holds significant opportunities for the growth in demand for construction machinery. With the prospects of large infrastructure projects and shifting labor dynamics, the construction equipment rental market is expected to witness growth post-2020 during the forecast period. With a sudden outbreak of COVID-19 pandemic across the world, many economic sectors, including the construction industry, have been under lockdown for a few weeks/months in the first quarter of 2020.

Thus, construction equipment rental in these scenarios proves to be the preferable and effective choices for the construction companies, primarily to reduce or minimize the impact of unexpected financial downturns.

Asia-Pacific is Expected to Dominate the Construction Equipment Rental Market

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In 2020, the sudden outbreak of COVID-19 pandemic across the world resulted in the lockdown of many economic sectors, including the construction industry, for a few weeks/months during the first quarter of 2020.

However, during this time, critical government construction projects, such as hospital builds, key utilities, and infrastructure, continued working but at a slower pace with less labor force at the job site to prevent the spread of coronavirus. Thus, during 2020, the construction equipment rental market value fell due to a fall in the global economic growth, which, in turn, is resulting in a slow down of construction work timelines.

Currently, the construction equipment rental companies and construction contractors have slowly started to resume their construction works as governments have started giving approvals for commercial construction projects across the cities in many countries, like the United States, India, the United Kingdom, and China.

The Asia-Pacific is one of the largest markets that has witnessed a boom in the construction and infrastructural development, because of the growing emphasis by the governments on developing infrastructure for a sustainable economy. This region witnessed growth in the number of Special Economic Zones (SEZs), airports, metro construction, highway constructions, dams, hydroelectric projects, etc., in order to sustain high-level industrial activities, better connectivity, and growing energy demand. As a result, many international players are beginning to invest and are setting up manufacturing facilities and distribution centers in the region to meet the growing demand and to capture the regional market. Construction machinery manufacturers, such as Liebherr, Caterpillar, Hitachi, and Sumitomo Corporation, are offering rental services that face intense competition from numerous domestic and regional players, owing to the competitive pricing and technologically advanced equipment availability.

In order to ramp up the efficiency of work and reduce the maintenance cost of the machinery, equipment rental software solutions provide a base to the construction machinery rental companies. The majority ofthe international companies already started using these software solutions to track the precise working hours, parts replacement cycle, and operation efficiency.

Competitive Landscape

The global construction equipment rental market is characterized by the presence of numerous domestic and regional players, resulting in a highly fragmented market environment.

The five key players, namely United Rentals Inc., Ashtead Group PLC, Herc Rentals, H&E Equipment Services, Loxaman, and Kanamoto Co. Ltd, in the market account for 18% of the market share, and the remaining 82% of the market share is held by other players (domestic or regional players).

The market is highly driven by mergers and acquisitions and joint venture activities

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Categories Automotive
Tags construction equipment rental market , construction equipment rental market analysis , construction equipment rental market forecast , construction equipment rental market growth , construction equipment rental market share , construction equipment rental market size , construction equipment rental market trends , covid19 impact
Last Updated April 19, 2021