According to the latest news, despite the global uncertainty caused by geopolitical turmoil, rising inflation and the war in Ukraine, the MEWP rental market continues to recover strongly after the pandemic in 2021 and early 2022 - this is an analysis conducted by Ducker for the international aerial work platform Alliance (ipaf).
Most markets in Europe, the United States and the Middle East continue to recover strongly. Although the resurgence of covid-19 and the ensuing blockades and restrictions in some parts of China have indeed hindered the recovery of the Chinese market and caused a chain reaction to the supply. In fact, many western manufacturers have been affected by supply chain problems. Therefore, MEWP made in China was more and more popular in its overseas markets in 2021.
The newly published report on the global high altitude operation leasing market in 2022 shows that although many countries under study are still coping with the impact of the second and third waves of covid-19 virus, leading to relatively cautious performance at the beginning of the year, most MEWP leasing companies seek to increase the scale and utilization rate of the leasing fleet in 2021; After the pandemic, the global recovery was quite stable and maintained a stable growth rate.
Many companies have resumed their planned investment strategies, but the supply side is difficult to keep up with the market demand for new machines, especially the professional and all electric MEWP. This is mainly due to the "contradiction between supply and demand" effect of the pandemic recovery on fuel prices, energy costs and raw materials. This has led to longer delivery times for new machines and increased reliance on old or used machines to maintain the fleet to meet demand.
It can be seen that this impact will continue to exist in the first half of 2022, because of the chain reaction of rising global energy costs, soaring inflation in most developed economies, and the war between Russia and neighboring Ukraine in February 2022.
Overall, the report shows that the European MEWP leasing market has partially recovered from the pandemic in 2021, and the overall revenue growth in 2021 is 7%. The total revenue of the European rental market reached 3 billion euros. Due to the recovery of demand in both the construction and non construction industries, the European market has almost returned to the active level before the pandemic. By the end of 2021, the number of European aircraft fleet was about 325000.
Driven by the recovery after the epidemic and the continuous shortage of OEM MEWP and supply problems, the utilization rate of the machine increased by 6%. The countries / regions most affected in Europe in 2020, such as the United Kingdom (revenue increased by 11%), Italy (12%) and France (13%), have the fastest recovery.
In other parts of Europe, the recovery is relatively mild, which is inversely proportional to the severity of the impact on the market at the first peak of the pandemic: the income of Spain and Sweden increased by 5% in 2021; Germany and Norway 3%; Denmark, Finland and the Netherlands all grew by only 2%. In contrast, the US market rebounded strongly, with an increase of 15%. However, this reflects not only the major blow suffered by the market in 2021, but also the financial recovery plan announced by the new US President Joe Biden.
Against the backdrop of the strongest income growth in the European countries studied, France regained its position as the largest MEWP fleet in Europe. By the end of 2020, Germany was ahead of France and Britain in terms of the overall fleet size. However, in the year of strong recovery, France's fleet increased to more than 62000 by the end of 2021, while Germany's fleet was only slightly higher than 60000, and Britain's fleet totaled 58000.
In all European countries, their transition to "more environmentally friendly" electric and hybrid machines continues to be strong, despite being hampered by the lack of timely delivery of new machines. Electric scissor machines are dominant in all countries, especially the Netherlands, northern Europe and Germany. Other parts of Europe continue to transition to electric scissor machines, but most countries still use diesel scissor machines for outdoor operation. European leasing companies are expected to complete the transition to a "green" fleet in 5-10 years.
In the United States, due to the rapid reopening of non construction businesses and the suspension of pent up demand for construction projects in 2020, the rental income of MEWP increased by 15% in 2021, exceeding the level before the pandemic. With the inauguration of President Joe Biden in early 2021, the introduction of vaccines and post pandemic recovery stimulus measures helped the United States rebuild confidence and rebound activities.
This has driven revenue growth (partly due to the increase in rent, driven by the demand for MEWP). In 2021, the size of the US MEWP fleet increased by 10%, because the leasing company resumed its investment strategy before the pandemic and tried to prevent the utilization rate from increasing significantly.
Like other Western markets, the overall fleet growth of the United States is hindered by the interruption of the supply chain. Nevertheless, the United States can still increase the fleet size by more than 60000, reaching 722105 by the end of 2021. This growth is expected to continue in 2022, but may be restrained by inflationary pressures on economic and trade issues, including the prohibitive tariff ruling on Chinese MEWP imports announced in 2021.
As in Europe, typical power types continued to develop towards hybrid or all electric machines during the year, although at a slower pace than in the European market. In the United States, the demand for electric boom type is not large, not only because of limited autonomy and charging infrastructure, but also because of climate restrictions, some parts of the United States cannot use electrical equipment outdoors in certain months.
As in 2021, the 2022 report also pays special attention to China and the Middle East Gulf Cooperation Council (GCC) countries such as Saudi Arabia, the United Arab Emirates and Qatar. This China report describes that despite the impact of the epidemic, the MEWP leasing market is still growing at an unprecedented rate - the MEWP leasing market in China maintained a strong growth (47%) in 2021, mainly driven by the expansion of the fleet. However, the uncertainty of the continued outbreak of the epidemic in major cities in China has limited market optimism. It is estimated that the annual income growth in 2022 and 2023 will be 10% and 6% respectively.
In terms of the total fleet size, this continues to grow at an alarming rate in China: it is expected that the total number of MEWP leased fleet will rapidly expand to nearly 330000 in 2021. By the end of 2022, the total fleet size is expected to reach 435000 to 440000. After years of rapid growth, it is expected that the fleet growth will be more moderate from 2023, but it will still reach double digits. Will China's rental fleet surpass that of the United States at some point in the next five years? At this speed, I cannot rule out this possibility.
The situation in the Middle East is to a large extent positive, and the recovery mode closely follows the high-end market in Europe or the United States. The average income of the three middle eastern countries studied increased by 13%, while that of France and the United States increased by 13% and 15%, respectively. Driven by the infrastructure investment in the region and the business generated by the Dubai World Expo in the fourth quarter of 2021, the total rental income of the three countries recovered from the low point of the epidemic, with an annual total income of US $146 million.
In 2021, the total fleet size of the three middle east countries in our study increased by about 2%, due to leasing companies increasing the fleet to pre pandemic levels to keep up with the recovery of demand. In 2022, respondents are expected to continue to buy machines and turn more and more to Chinese MEWP manufacturers.
Although diesel powered boom type machines still account for the majority of MEWP fleets in all three countries, as the end use shifts to facility management and people pay more attention to workplace safety and occupational health, scaffolds are gradually phased out, which is conducive to increasing the use of electric scissor type machines in internal maintenance and repair.
In short, the fleet size and rental income of all the markets we studied are increasing, investment confidence has been restored, and the pace of switching to electric machines continues to accelerate. Even the well-documented supply chain problems can not suppress the market optimism. Although the future is not very clear, the global high-altitude operation leasing industry still has a bright future in the foreseeable future.
