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Reaching For Heights

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Tags: Genie , Hertz Dayim , JLG

Post Date: February 24, 2020
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New machines and technologies from manufacturers could help access equipment rental companies to provide an expanded and more efficient service offering to their customers.

Business has been slow for aerial work platform (AWP) suppliers in the GCC. In the UAE, a number of new rental companies entered the market in 2016-2017, leading to oversupply and putting pressure on rates. Meanwhile, in other markets, notably Saudi Arabia, delays in projects have also slowed down sales.

“2019 was definitely a challenging year for everyone in construction equipment overall,” says Ian Hume, Sales Director, Middle East, India, Russia & Africa, at JLG Industries. “We saw the numbers of machines coming into the market being put under pressure.”

This was particularly felt in the UAE, typically one of the biggest regional markets for access equipment. “[Lower sales in the UAE in 2019 were] partly a result of two very strong years of growth in 2017-18. We saw some new rental players enter the market over the past three years, leading to slight pressure on rental rates. We have seen some bright spots in Saudi Arabia, and we’re expecting that to continue in 2020, so much so that it could be that Saudi Arabia overtakes the UAE as the biggest buyer of access equipment in the GCC,” says Hume. Traditionally, around 75-85% of JLG’s sales in the region are to rental companies, he adds. 

Major projects in other GCC countries, such as the BAPCO refinery project in Bahrain or the Duqm project in Oman, could lead to spikes in demand, he says. “Whether you see a huge amount of investment in new equipment or transfers of fleet from the UAE – which may be more likely – these are welcome projects for the region.”

Cashflow and timely payments remain a perennial pain for contractors and and rental companies, Hume notes. “Particularly over the past 12 months, it’s really been a challenge to collect your dues from the market.”


Hertz Dayim has one of the largest MEWP fleets in the region.

Sharbel Kordahi, Director – AWP MESART and Managing Director – Terex Equipment Middle East, says 2019 was acceptable for Genie overall, although it did not meet expectations, with delays on projects causing many customers to in turn delay their own capital expenditure.

“Nevertheless we still maintained our market share, which is always a good thing,” says Kordahi. The cyclical nature of sales also reflects shifts in the market structure. “In the past three years, the market has shifted from being predominantly an end user market to being predominantly a rental market. Last year was a reflection of that.”

Among established access rental equipment players, there are questions about the sustainability of the low rates offered by some of the newer players in terms of their overall business model. “We have seen several new entrants into the market,” says Andy Carter, GM of Hertz Dayim. “Despite offering new equipment, the rental rates being offered will deliver substandard return on investment, which eventually makes it difficult for these companies to invest further in this product range.”

Wilfred Fernandes, Resale Business Manager at Access Rental Gulf, says it’s a tough market for rental houses, with pressure on rates and bottom lines. Customers are also becoming used to a higher standard of service. “It’s driving the market to be more creative,” he says, with rental companies offering better payment terms, improved operator training and work-site management services to make the offering more attractive. Nevertheless, sales of used rental machines from ARG remain constant, with the main buying markets of ex-GCC machines including India and African countries, he says.

Safety-focused

Despite difficult market conditions, rental company customers are also being more selective in their requirements, meaning that rental companies still need to invest in the latest equipment, operator training and other productivity features. Some of the biggest clients are in the petrochemicals sector, where equipment requirements are especially stringent.


Indoor use is one key application for electric or hybrid MEWPs.

“Rental companies are now forced to maintain younger fleets, with machines between three and five years old,” says Kordahi. Professional operator training, overload sensors and spark arresters on engines are among the key features required on a rental machine for demanding clients, he notes.

Rental companies need a very diverse fleet that can replace whatever a customer is currently using with existing solutions, whether it’s a step ladder, a folding scaffold or a compact crawler, says Hume. “The demand we’re seeing from the rental companies is not just your traditional electric scissors and diesel booms, but we’re also getting demand from other market segments that can give them potentially higher returns than traditional access.”

Hertz Dayim has one of the largest fleets in the region, says Carter. “Our recent investment has been into the Ultra Booms, which is in line with our financial strategic plan as the investment utilisation and dollar utilisation deliver better returns.” The company has always offered the latest safety features and telematics systems – “This is now a prerequisite from many of our clients,” says Carter.

In September 2019, Dubai Municipality released a Technical Guideline for Mobile Elevated Work Platforms (MEWP), providing detailed instructions around operating access machinery, including a requirement for trained operators that is more in line with European standards. This should boost demand for professional access solutions, if end users can no longer use ad-hoc solutions or machines powered by untrained operators.

“Items like that – improving the safety or regulations of working heights, similar to the European model – will encourage companies to use access, and it is a safer and more productive way for you to do the job anyway,” says Hume.

There’s hope that enhanced guidelines will be adopted more widely around the region. “The Dubai Municipality guidelines are excellent, they put some guidance towards the condition of equipment, the operator qualification – they mandate IPAF, which is all fantastic,” says Kordahi. “But I think now the next step will be to improve the training for the inspectors that come and inspect the machines, so they know what they’re doing.”

The International Powered Access Federation (IPAF) is a key player when it comes to operator training and safety standards, and many of the OEMs and rental companies in the industry are members. Hertz Dayim is an accredited IPAF training provider in KSA and will soon roll out the service offering across Kuwait and Qatar, says Carter. “We believe this demonstrates the strength of our brand, providing our clients with peace of mind that we can provide intense training to their operators to ensure they are working safely and efficiently.”

Will access go electric?

While electric access machines are widely used in highly regulated markets, this is not so much the case in the GCC. “I don’t think that the level of penetration of electric and hybrid products are at the level we would want them to be, because this is a big focus area from all the major manufacturers. In the GCC countries it is very selective and depends on the customers themselves, but there are no rules or regulations driving the use of electric products,” says Kordahi.

That contrasts with markets such as the EU, where use of electric machines is more regularly required, such as in built-up areas. Kordahi suggests that in the GCC, electric machines could be required to be used in certain key areas, such as Downtown Dubai or the King Abdullah Financial District in Riyadh, instead of diesel machines that are noisy and produce fumes. Requirements for use of electric machines indoors could also be more stringently implemented, he suggests.

There may soon be more use of electric access machines, with a wider range of options for buyers. JLG offers lithium-powered electric booms which can match diesel for performance, as well as being suited for work on construction sites, says Hume. But one reason electric machines are not widely used is convenience around fuel supply; diesel is readily available on all construction sites, while a consistent power supply to charge the battery has to be available on-site, rather than a fluctuating power source or generator.

“These things will come as the infrastructure is built around it, but at this point it’s still a challenge, especially in construction,” says Hume. Facilities management is one area where electric machines are more quickly being adopted, he notes.


JLG offers electric booms fit for construction sites.

Telematics systems are also a focus area for manufacturers, increasingly used by rental companies as a fleet management tool to monitor machines, says Kordahi.

“Telematics can see where the machine is working, but also how it is operated, what condition it is, whether there are any faults, and – when there is a fault – whether this can be rectified simply with a phone call rather than having to drive to site for something simple. It’s more of a demand for rental companies than end users,” he says.

A number of customers are currently doing trials with JLG’s ClearSky telematics product, and Hume believes rental companies stand to benefit the most from increased visibility into a machine’s health. Being able to accurately diagnose a fault on a machine remotely allows a firm to send out a technician with the right tools and spare parts to fix it, rather than having to travel to the site to diagnose the problem and then potentially return to collect what is needed to make the repair – especially when it comes to remote sites that take hours to reach, such as a petrochemical plant in Al Ruwais.

Using telematics also allows rental companies to offer additional features to customers, such as access control – a lock on the machine that only the trained operator can unlock, visibility over where a particular machine is working on a construction site, and geofencing machines to the zones a contractor is responsible for.

Rental companies will also benefit from JLG proactively monitoring machines and the OEM’s expertise, says Hume. “As rental companies start putting a dollar value against that high spend and the loss of efficiency, then it becomes a very easy calculation for them to have ClearSky fitted onto their JLG fleet.”

Post Date: February 24, 2020
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