With the growing construction activities across the UAE, it is observed that contractors are increasingly inclining toward renting the construction equipment. It is principally due to an extensive range of benefits like avoiding expenses on purchase & maintenance, exposure to technologically advanced & latest equipment, enhancing the construction operations, & bringing automation & telematics in complex procedures, among others. Besides, since many models of construction equipment involve high ownership costs, contractors see renting them as a smart way of attaining all the benefits of equipment in different applications periodically.
The UAE Construction Equipment Rental Market is projected to grow at a CAGR of less than 5% during the forecast period, i.e., 2022-27. The growth of the market is likely to be driven primarily by the rapidly growing number of construction activities in the UAE, owing to the mounting focus on infrastructural developments in line with the UAE Vision 2030.
Additionally, rapid technological advancements with automation & telematics in the equipment to enhance operational efficiency are also playing a prominent role in stimulating the demand for construction equipment across the UAE. However, the high cost of construction equipment is swiftly bringing traction toward their rental supply for different construction applications, which, in turn, is driving the market.
|Study Period||Historical Data: 2017-20|
|Base Year: 2021|
|Forecast Period: 2022-27|
|Key Companies Profiled||Al Mutawa Heavy Equipment, Mohamed Abdulrahman Al-Bahar, Al Faris, Johnson Arabia, Byrne Rental, Al Shola Rental, Yellow Cat Heavy Equipment, Aggreko, Tanzeem Heavy Equipment Rental, Gallagher International|
|Unit Denominations||USD Million/Billion|
Besides, since the country is a host for the ongoing World Expo 2020, the UAE government has been contributing to the surging number of construction projects for highways, shopping malls, & hotels, among others, and, as a result, positively influencing the demand for construction equipment rentals. Moreover, several initiatives by the government are generating immense growth opportunities for the leading players in the UAE Construction Equipment Rental Market. For instance:
With such projects, the demand for construction equipment is escalating swiftly and generating growth opportunities for the leading market players to provide equipment rental services & augment the market growth over the forecast years. The advent of Covid-19 in 2020 had a decelerating impact on most industries across the UAE, where the Constriction Equipment Rental Market was moderately affected. The imposition of stringent restrictions & lockdowns by the UAE government to curb the spread of this dreadful disease introduced several unprecedented challenges to the market.
Since the construction industry is highly prominent in the UAE for economic sustainability, the government allowed construction activities to remain operational amidst the pandemic. As a result, workers involved in projects were permitted to commute to & from sites, provided they had the permit from the Dubai Municipality & the Permanent Committee for Labor Affairs.
Moreover, the government ensured to mitigate the possibility of disease spread by avoiding physical & face to face contact by adopting electronic, automated, and safer means for construction operations. It, in turn, augmented the demand for construction equipment with technologies like automation & telematics to enhance the operations & bring efficiency & speed to the process.
However, hampered transportation & logistics affected the supply & deliveries of equipment across locations and slowed construction operations, thereby witnessing a temporary decline. Nonetheless, with the gradual upliftment of restrictions & frequent lockdowns, along with a reducing number of Covid-19 cases, the government allowed the recommencement of business operations.
As a result, the supply of equipment & rental services were back in the flow. The temporary halt in the industry demonstrated the emergence of new players in the market and increased competition for the market players across the UAE.
Based on End-Users:
Of these three, the Residential sector is anticipated to dominate the UAE Construction Equipment Rental Market with the largest share during the forecast period. It owes principally to the increasing number of construction projects for smart buildings & cities entwined with the growing need for residential complexes to habitat the mounting population & growing footfall of migrants. It, in turn, is augmenting the demand for construction equipment on rent and driving the market.
The most prominent factor behind the growing construction activities across the residential sector remains the UAE Vision 2030 to diversify the economy away from oil. As a result, the residential sector is witnessing massive investment in infrastructural developments and positively influencing the growth of the UAE Construction Equipment Rental Market.
On the other hand, the Commercial sector is expected to demonstrate the fastest market growth, whereas the industrial sector is likely to display steady growth over the forecast years. It owes principally to the rapidly increasing establishment of prominent multinational companies & rising job opportunities, i.e., propelling the need for corporate spaces.
In addition, escalating tourism in the country is resulting in the need for developing shopping malls, airports, metro stations, highways, & hotels, among others. It, in turn, is projecting an increasing number of construction activities for commercial applications & mounting demand for construction equipment & machinery on rent during 2022-27.
Based on the Type of Equipment:
Here, Earth Moving Equipment acquired a significant market share in recent years, owing principally to the country's aim to establish itself as a construction hub across the Middle East, i.e., propelling the demand for excavators, loaders, & cranes, among others, on a rental basis. Since these types of equipment are used extensively in every construction project, the demand for earthmoving equipment is very likely to display significant growth opportunities for the UAE Construction Equipment Rental Market through 2027.
Recent Developments by Leading Companies
Due to the significant growth prospects of the UAE Construction Equipment Rental Market through 2027, several leading players are actively working toward expanding their product portfolio and strengthening their scalability across the UAE. For instance:
Key Driver & Opportunity: Advancements in Construction Equipment
The quick advent of technologies in construction equipment is introducing new features in the machinery and enabling efficiency & quicker construction operations. Hence, the demand for advanced equipment is escalating swiftly for rentals & generating growth opportunities for the leading players in the UAE Construction Equipment Rental Market to attract contractors in the competitive industry and drive the market in the coming years.
Moreover, the expanding scalability of equipment rental service providers across remote locations in the UAE is instigating contractors to rent the construction equipment and thus contribute to the overall market growth during 2022-27.
Possible Restraint: Volatile Rents & Expenses on Pick-ups & Deliveries
The growing number of construction projects, i.e., displaying a soaring need for advanced & robust equipment, is witnessing fluctuations in rents. It, in turn, is anticipated to generate demand & supply gaps, especially across budgeted contracts, and obstruct the growth of the UAE Construction Equipment Rental Market in the coming years.
Moreover, high expenses associated with the pick-up & delivery of construction equipment might also act as a prominent challenge for the overall market growth during 2022-27, especially when the project site is located remotely.
Key Questions Answered in the Market Research Report:
Frequently Asked Questions
A. The UAE Construction Equipment Rental Market is projected to grow at a CAGR of less than 5% during 2022-27.
A. The Residential sector is anticipated to emerge as an area of remunerative opportunities for the leading players in the UAE Construction Equipment Rental Market during 2022-27.
A. Technological advancements in construction equipment are introducing new features in the machinery for efficient & quicker construction operations, which would generate growth opportunities for the leading players & drive the UAE Construction Equipment Rental Market through 2027.
A. In the coming years, the UAE Construction Equipment Rental Market is anticipated to witness considerable growth, owing to the expanding fleet & reachability of construction equipment rental service providers in the UAE.