LONDON--(BUSINESS WIRE)--Technavio market research analysts forecast the global construction equipment rental market to grow at a CAGR of more than 5% during the forecast period, according to their latest report.
The market study covers the present scenario and growth prospects of the global construction equipment rental market for 2017-2021. The report also lists Europe, North Americas, APAC, and ROW as the four major geographical segments, of which Europe accounted for the maximum share of 36%, followed by the North America and APAC with market shares of 35% and 19%, respectively. ROW accounted for 10% of the overall market share.
According to Anju Ajaykumar, a lead analyst at Technavio for construction research, “The increase in the number of construction projects will add to the growth of the market. Increased investments by the governments of many countries, in the development of transport infrastructure, will spur the demand for concrete and road construction equipment during the forecast period.”
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Technavio analysts highlight the following three market drivers that are contributing to the growth of the global construction equipment rental market:
- Rising need to replace outdated equipment
- Growing construction in the US
- Growing environmental concerns
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Rising need to replace outdated equipment
Increasing need to replace the outdated and obsolete equipment and rise in the rental service from major vendors will drive the global construction equipment rental market. Construction equipment such as dump truck, dozer, and grader, forklift, or tractors cannot be used after a certain point. The extended use of construction equipment will have a severe impact on the operational cost maintenance and repairs.
Rental companies are focused on providing excellent customer service in terms of machine performance and maintenance. This factor is expected to drive many new equipment buyers to shift toward renting as this will act as a major cost saving. Thus, renting equipment, which will have all regulations in place plus additional maintenance service, is becoming preferable for buyers.
Growing construction in the US
The US remains one of the world's largest real estate markets, and the non-residential sector is set to rise in the US. The construction market in the US is driven largely by the construction offices, warehouses, and multi-family apartments. The non-residential sector is experiencing consistent growth in the US. Also, the country is experiencing a rising interest of foreign investors in its real estate sector. For instance, several Chinese developers have collaborated with US firms to work on massive landmark development projects. Greenland Holding Group, the Shanghai-based real estate development company, has been working to complete Metropolis, the largest mixed-use development on the west coast, which is expected to be completed in 2018.
Growing public and private infrastructure spending in developing nations
Growing urbanization and increasing disposable income in emerging countries are demanding governments to increase their public spending toward infrastructure development. In India, the government allocated a sum of USD 7.2 billion for the implementation of smart city mission. Recently, the real estate giant, Emaar, invested USD 1.32 billion in India for commercial construction development as part of the foreign direct investment.
“This huge growth of construction activity in both the commercial and residential sectors in APAC is anticipated to fuel the demand growth of anti-skid ceramic tile in the region. Population and income growth can also lead to the growth of the residential sector in emerging nation,” says Anju.
Indonesia is one among the emerging nations, which is showing significant growth in residential apartments. A large population base blended with strong economic growth over the past few years has boosted the country's housing market, especially in Jakarta.
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