GCC equipment rental market to grow 6.15% to reach $5.48bn by 2026
30 Dec 2021
New research projects growth in rental sector on expanding construction and infrastructure work fuelled by public spending and national plans in the region
The construction equipment rental market in he GCC is expected to register a compounded annual growth rate (CAGR) of 6.15% over the next five years to reach $5.48 billion by 2026 from its valuation of $3.77bn in 2020.
According to a new report by Research And Markets, the construction equipment sector across the GCC is expected to gain momentum during the forecast period after Covid-19 hindered its growth in 2020 and early 2021 owing first to the shutdowns, followed by halt of investments into the projects and infrastructure sectors and also the temporary suspension of work at manufacturing facilities.
Post-pandemic, however, as economic activities resumed, the market is projected to gain strength, with some of the major driving factors being the construction sector's growth in the region, increasing demand for cranes and developing trends toward automation and telematics.
The report added that the renting or leasing of construction equipment has been on the rise, owing to an effort to lower the equipment purchase and maintenance expenses. Apart from the cost, there are also other benefits associated with renting of construction equipment. Many rental companies provide the machinery along with the required professional machine operators and drivers, thereby ensuring hassle-free operation, said the report.
Moreover, advancements in the ways rental machinery is used in construction, such as through telematics and digitalisation, is providing ease to customers, leading to further growth of the construction machinery rental market in GCC countries, said Research and Markets.
The report added that the construction sector in countries such as the UAE, Saudi Arabia, Qatar and Bahrain is seeing growth on the back of projects related to roads, buildings, hotels, stadiums and other infrastructure. Projects such as railways and road and highway projects in various countries in the region are leading to a rise in the renting of earth moving equipment, such excavators, loaders and motor graders.
Moreover, in countries like Saudi Arabia, government plans like the Saudi Vision 2030 are leading to the penetration of more construction contractors. For instance, in February last year, Saudi Crown Prince Mohammed bin Salman ordered the development of the main roads in the heart of Riyadh in order to upgrade the city's transportation system. The project’s objective is to transform Riyadh into a major hub in providing sustainable transportation services as well as logistics services in the Middle East, stated the report. The programme will work on developing junctions between Riyadh's ring roads and main routes, developing 400km of the road network by adding new roads and upgrading existing junctions.