News Item: Plant Hire Market Impacted by Covid-19
The UK plant hire market declined significantly in 2020 due to the Covid-19 pandemic. The fall in demand as well as fleet utilisation rates can be attributed to the overall fall in construction levels in the majority of end use sectors throughout the pandemic.
The UK plant hire market is diverse, with equipment ranging from excavators to lighting towers and regional equipment requirements with low ground pressure excavators popular in the South and a strong focus on quarry and mining dump trucks in the North. In general, the level and nature of plant hire is impacted by the construction cycle, with the hire of excavators for groundworks initiating the cycle.
It is stated that the plant hire market is heavily influenced by overall construction levels as well as industrial activity and the general performance of the UK economy. Some hire sectors are more influenced by non-construction sectors such as manufacturing, waste management, the weather, and the events sector.
Other influences, such as weather-related factors impact on the level of hire demand, such as flooding which tends to stimulate demand for the hire of pumps, generators and dehumidifiers. Subsequently there has been an increase in damaged roads, stimulating demand for equipment such as compactors and rollers to undertake road repairs and fill potholes.
The Covid-19 pandemic in 2020 significantly impacted on the development and advancements of plant hire, although the second lockdown did not impact hire demand as much as the first because construction and infrastructure sectors continued to operate.
In addition to hire demand, plant hire companies were affected by the extra costs of sanitising machines and operators’ safety, which impacts on company profits. However, in addition to open construction sites, some hire companies benefited from demand for the Covid-19 emergency response supporting government and private sector responses to the pandemic. This included for example providing vital equipment for hospitals, alternative care facilities, testing sites and telecommunications and utility companies. The main types of equipment required at testing and vaccination centres included generators, site cabins and lighting towers.
Prospects for the plant hire market into the medium-term are relatively optimistic. The range of factors influencing the market are extensive and the type of plant hired will be influenced by the applications required in each end-user sector as well as wider macro-issues and other more product specific issues. Given the scale of fluctuations caused by the recent pandemic, forecasting future prospects of the plant hire market at this time is extremely difficult, exacerbated by the UK’s exit from the European Union and the possible impact this may have on the UK economy and construction levels.