Powered by the skyrocketing costs of construction material and labor every year, the construction equipment rental market has emerged to be one of the most lucrative business spheres of the times. In the face of this rapidly increasing constructional cost, the concept of leasing or renting high-grade machineries instead of purchasing it, has proven to be way more beneficial for companies.
Massive Industrial Projects
Massive industrial projects inherently require massive investments and collaboration from a variety of sources. Everyone involved stands to profit in these projects and the current system is justifiably built to ensure everyone maximizes potential returns from these investments. Some of the key players in the construction equipment rental market include Ahern Rentals, Inc., Ashtead Group, Blueline Rental LLC, Cramo PLC, Loxam Group, Shanghai Hongxin Equipment Engineering Co., Ltd., Caterpillar, Inc., Herc Holdings, Riwal, Nesco Rentals, and United Rentals, Inc.
Private Contracted Projects
While private companies remain major players in the industry, it is the government’s involvements in these projects which prove to drive tremendous growth in the industry. For instance, a Construction Productivity and Capability Fund (CPCF) was announced by The Building and Construction Authority (BCA) in Singapore to aid in the construction industry to improve productivity and strengthen its capabilities. The fund incentives a focus on workforce development, technology adoption and capability developments in Singapore’s built environment and based on its success, similar initiatives are expected to grow across the region.
Chinese Industrial Projects
Across Asia, especially in China at the moment, there is so much industrial opportunity and so many projects for companies to complete, with little to no competition that even ‘hard times’ result in normal growth for rental and leasing companies. The construction equipment rental market has been growing at a rapid pace over the years with expectations for this to continue due to “commercialization, rapid urbanization, burgeoning population, increasing government initiatives, and robust fiscal growth.”
China alone, according to research conducted by Morgan Stanley, is poised to invest over $1.3 trillion USD in an effort to establish economic clout by modernizing their country. This will involve infrastructure projects such as railway systems to connect their major cities, 97 new domestic airports, 28 nuclear power stations, and 3 hydroelectric plants.
According to Morgan Stanley research on China’s economic and market outlook, as well as policy and market strategy outlooks, China’s transitioning economy will continue to ripple across domestic industries. Investors looking to tap into the next wave of growth are strongly recommended to look at the potential of the development initiatives taking place in the country’s smaller cities.
They are also expanding their global influence through their Silk Road – Belt and Road Initiative which is focused on developing major trade routes through Asia, Africa, Europe and the South China Sea. These projects have led to tremendous demand for all things construction related and have already created remarkable profits for valued property owners and investors.
Besides China however, perhaps the most exciting market in the near future will be India which has placed tremendous importance on infrastructure developments aimed to parallel the population growth which is expected to surpass China’s number one spot within only a few short years. Their domestic construction sector is predicted to grow twice as fast as China’s leading up to 2030 with close to $1 trillion USD being invested towards 27 industrial clusters including road, railway, and port connectivity projects.
The Future of Industrial Projects
An example of this is a recent announcement from the Government of India in launching major infrastructure projects like Setu Bharatam project, Gujarat-Gorakhpur gas pipeline, Chardham Highway project, and the massive Bharatmala project which will connect all major cities in the country to one major road. All of these projects are predicted to contribute to the construction equipment rental market growth in the region for years to come.