MEWP rental markets rocket, but uncertainty clouds outlook

In 2022, both the European and US mobile elevating work platform (MEWP) rental markets boomed to exceed pre-pandemic levels – though some key indicators such as rental and utilisation rates have yet to return to levels seen in 2019. Uncertainty around high inflation and the ongoing conflict in Ukraine cloud the outlook for 2023-24, according to the latest analysis conducted for the International Powered Access Federation (IPAF) by Ducker.

The European MEWP rental market reached €3.2 billion total revenue, driven by rental companies investing in their fleet, catching up on renewal and expansion plans that were hampered by supply-chain issues and limited availability of some new machines from manufacturers, the 2023 IPAF Rental Market Report indicates.

The European fleet stood at a total of approximately 340,000 units at the end of 2022. Most European markets under study experienced high levels of growth and rebounding activity in both construction and non-construction sectors. Overall, the European MEWP rental market grew by 8%, with Spain (12%), France (9%), the Netherlands and Italy (both 8%) showing the highest levels of growth, while the four Nordic countries (Denmark, Finland, Norway and Sweden) showed 4% growth.

The total rental MEWP fleet size in the 10 European countries under study was estimated to stand at approximately 340,000 units as of the end of 2022. In 2022, on the back of the strongest growth out of the 10 European countries under study, France maintained its position as having the largest MEWP rental fleet, exceeding 67,000 units after growing by approximately 5,000 units. Second in terms of size was the German fleet, at close to 62,500 units, followed closely by the UK fleet, at almost 60,000 units (low-level access units excluded).

Average revenue increased to €9,505 per unit and, as in previous years, Germany had the highest revenue per unit. Across Europe, utilisation rate went up by 1 per cent, to an average of 65 per cent, after a steep recovery in 2021, partly driven by limited availability and fleet expansion and partly by elevated demand. After a slower recovery in 2021, Spain saw utilisation rate increase by 3 per cent during 2022.

With unprecedented market demand and both inflation and MEWP purchase prices rising, rental companies were forced to substantially increase rental rates in most European countries, leading to an average rise of around 4 per cent in 2022. Only the Nordic region experienced challenges, owing mainly to consolidation activity, increasing already fierce market competition, which suppressed rental rate growth.

Levels of investment remained positive, increasing by 24 per cent in 2022 compared to 2021. In addition to high demand, investment was driven by rental companies wanting to renew fleets and transition to greener technology. Market outlooks remain positive, as manufacturer lead times are expected to reduce over the next 12-18 months and rental companies forecast continued healthy demand and revenue increases, driven by rental rate rises to offset the effects of inflation and input-cost pressures.

In the US, MEWP rental revenue increased by 15 per cent and reached US$13.6 billion in 2022, owing to a strong economy and high demand. MEWP fleet size in the US grew by 10 per cent, as rental companies resumed increasing fleet size in a bid to cap utilisation rates from further rises. Utilisation rates rose to 73 per cent on average – previously unseen levels in the US market. Despite lead times improving on new OEM MEWPs, rental companies reported backlogs persisting in 2022-23.

Owing to ongoing supply-chain issues, average retention period increased in the US, raising concerns about ageing fleets, which is expected to keep investment levels high in 2023. As predicted in 2022’s report, high tariffs imposed on Chinese-manufactured machines restricted availability in the market, increasing purchase-price pressures.

US average rental rates increased by 5 per cent in 2022 to compensate for the increase in MEWP procurement costs and inflationary pressures. Most companies expected further rental rate increases in 2023, though at a slower pace, as is it hard to sustain client relationships with high year-on-year increases.

As in previous year’s, the report contains a special China Market Focus, which shows that in 2022, Chinese MEWP rental revenue grew by 13 per cent, primarily driven by the expansion of rental company fleets. However, both rental and utilisation rates decreased in 2022 owing to insufficient demand during recurring regional pandemic lockdowns and enduring fierce market competition, exacerbated by rapid fleet expansion. With rental demand recovering in the first quarter, utilisation is expected to rise again in 2023 from the lows experienced during the peaks of the pandemic.

● For detailed analysis of European, US and Chinese markets, the 2023 IPAF Rental Market Reports are available now. IPAF manufacturer, supplier, distributor and rental company members can apply for a free copy of the relevant report by filling in the form at www.ipaf.org/reports; non-members are able to purchase the report.