Focus on the positives

9 December 2022

While it’s clear that we are witnessing a much-anticipated economic slowdown and the year ahead will be challenging, it’s by no means all doom and gloom. 

One plant and tool hirer tells me: “We had our second busiest day ever for new machine hirers on Monday this week with 36 orders, mainly for excavators and powered access. We would normally regard 20 as being a very good day. 

“And we have 70 per cent utilisation across the board right at this moment. So I can’t complain.

“I don’t know how long it will last. But ongoing delays in deliveries of new equipment will keep general availability lower, creating customer demand and hopefully keeping rates sensible. It also maintains the residual value of equipment. We are still waiting for machines we ordered back in September 2021! And I’m not sure when we’ll see them.”

Some similar sentiments were expressed by Brendan Horgan, chief executive officer of Sunbelt Rentals parent Ashtead Group, when the company’s interim results were announced earlier this week. He maintains that the current economic backdrop is encouraging more people to hire equipment. 

“Consistent with what I’ve been saying in conjunction with recent results, the current supply and demand equation is as favourable as we’ve ever experienced,” he said. 

“This ongoing reality, which has now sustained for several quarters, makes incredibly clear the step change that we are witnessing. Rental penetration is deepening before our very eyes.” 

In addition, the need for more organisations to meet their environmental obligations is creating demand for new equipment powered by greener energy sources, which will be a long-term trend. 

And coupled with the views oif several economic commentators that the rate of inflation may be reaching its peak, there are still many positive factors to focus on.

Photo: Lorenzo Cafaro