UAE Construction Equipment Rental Market to Grow at a Healthy CAGR of 6.0% by 2027
Published | 13 September 2021
UAE construction equipment rental market is growing at a high CAGR because of the increasing construction activities of residential and commercial spaces and infrastructural development in the country and the high cost of construction equipment...
A recent study conducted by the strategic consulting and market research firm BlueWeave Consulting revealed that UAE construction equipment rental market was worth USD 18.0 billion in 2020. According to the study, the market is estimated to grow at a CAGR of 6.0%, earning revenue of around USD 26.8 billion by the end of 2027. Infrastructural development and increasing construction activities of residential and commercial spaces are driving demand for construction equipment rentals. Additionally, the high cost of construction equipment has prompted contractors to opt for rental services, which prove to be very cost-effective and saves unnecessary business expenditure. Furthermore, the flourishing oil and gas industry in UAE is also boosting the market demand for construction equipment rental because of the activities involved in oil and gas production and extraction. Construction workers use repair drilling equipment, hand tools, and transport materials to and from sites, which requires construction equipment. The economic slowdown and its impacts on construction activities may, however, impede the market growth.
Emerging Rental Business in UAE Driving Market Growth
The construction equipment rental market is relatively new and is still in its nascent stage in the UAE. Therefore, it holds excellent growth potential. As new players enter the market, the price competitiveness is likely to increase, offering great deals to contractors or consumers. This is expected to propel the market growth in the forecast period. Furthermore, the increasing penetration of rental services is also going to offer a wide range of machinery, equipment, and tools, which will further decline the need for buying these.
Growing Preference for Rental Equipment is Favoring the Growth of UAE Construction Equipment Rental Market
Construction equipment rentals are gaining massive popularity among contractors, infrastructure companies, oil and gas industries, and other sectors. Rental equipment is typically less expensive than purchasing new equipment because it is available at a lower price than buying new equipment. Purchasing new equipment is a very hectic process as it involves buying costs, coupled with repair and maintenance costs, depreciation costs, etc. Thus, the construction and other sectors intend to reduce their financing burden by switching to rental equipment, thus driving UAE construction equipment rental market forward.
UAE Construction Equipment Rental Market - By Operating Weight
Based on operating weight, the UAE construction equipment rental market is segmented into less than 100 tons, 100-200 tons, and more than 200 tons. Among these, the less than 100-ton segment holds the largest market share. The standard construction equipment usually hired on rent, such as wheel loaders, tractors, excavators, motor graders, etc., belong to this operating weight category. On the other hand, the 100 - 200-ton segment also covers a substantial share in the market because of the many heavy-duty construction equipment belonging to this category, such as hydraulics, landscape tiller, etc.
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UAE Construction Equipment Rental Market - Regional Insights
UAE construction equipment rental market is segmented into Dubai, Abu Dhabi, Sharjah, Umm Al Quwain, Ras Al Khaimah, Fujairah, and Ajman. Dubai accounts for the largest market share because of the increasing development and construction of buildings and skyscrapers in the city. Dubai has the highest number of skyscrapers in the UAE, followed by Abu Dhabi. With the increasing population, especially in these regions, the construction of residential buildings is gaining huge traction. Therefore, these emirates hold great potential for growth in the construction equipment rental market.
Impact of COVID-19 on UAE Construction Equipment Rental Market
Construction equipment rental in the UAE was adversely affected by the unprecedented outbreak of COVID-19. The lockdown imposed by the government and social distancing norms restricted the construction activities, declining the demand for construction equipment rental services. However, the market is likely to recover soon and flourish significantly in the post-COVID-19 period. Construction activity is set to resume economic growth as rentals gain traction. Additionally, the limited purchasing power of businesses will also favor the market. In this unpredictable situation, most contractors will opt to rent equipment instead of buying new equipment, which will boost market growth during the forecast period.
The leading players in UAE construction equipment rental market are Al Mutawa Heavy Equipment Trading LLC, Mohamed Abdulrahman Al-Bahar LLC, Yellow Cat Heavy Equipment & Machinery Rental, Byrne Equipment Rental, Al Shola Rental Solutions, Tanzeem Heavy Equipment Rental LLC, Gallagher International, Al Faris International Heavy Equipment Rental, Obaid Kneish& Sons Transport, AL Jaber Leasing Service, and other prominent players.
In the UAE, there are several construction equipment rental-service providers, which makes the market highly competitive. The prominent players adopt market strategies like partnerships, mergers, acquisitions, collaborations, etc., to expand their offerings and stay ahead in the competition. To advance their business operations, they also partner with construction companies.
The in-depth analysis of the report provides information about growth potential, upcoming trends, and statistics of UAE construction equipment rental market. It also highlights the factors driving forecasts of total market size. The report promises to provide recent technology trends of UAE construction equipment rental market and industry insights to help decision-makers make sound strategic decisions. Furthermore, the report also analyses the growth drivers, challenges, and competitive dynamics of the market.
BlueWeave Consulting provides comprehensive Market Intelligence (MI) Solutions to businesses regarding various products and services online and offline. We offer all-inclusive market research reports by analyzing both qualitative and quantitative data to boost up the performance of your business solutions. BWC has built its reputation from the scratch by delivering quality inputs and nourishing long-lasting relationships with its clients. We are one of the promising digital MI solutions companies providing agile assistance to make your business endeavors successful.
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