MARKET REPORT COMPACT PLANT
Sales rise at long last
Alan Guthrie examines some of the factors behind a welcome increase in compact plant sales during 2011.
Following three years of decline, sales of mini excavators have at long last risen during
2011.The numbers are still a very long way below the record year of 2007, when approximately 16,000 machines were sold in the UK and Eire, but this must be seen as a very positive and welcome sign indeed.
Estimates suggest that sales of minis will have risen by approximately 30% in 2011.
“We estimate that total sales of minis up to 9 tonne will reach 8,700 for 2011, compared with 6,393 in 2010, giving an increase of approximately
30%,” David Munns, Volvo Compact Equipment’s Road and Utility Director, told EHN. “We did forecast an increase this year, and this figure has slightly exceeded expectations.We believe there will be further growth in 2012, albeit at a slower rate.
Updating hire fleets
“Hirers have been updating their fleets. During the downturn, when utilisation fell, many sold machines to keep cash flow positive and they made do with their remaining machines, rather than replace them. Now they simply have to purchase new units, having put off for so long. Demand is spread evenly across all weight classes, and the hirers we have been speaking to say they are busy, which is another very positive sign.”
Robert Brown, MD of Ammann Equipment Ltd, reports a similar situation, adding that “with hindsight, some companies reduced their fleets by too much, meaning that this year they have found themselves not having enough machines and needing to buy more. However, with global production capacity having contracted, and component
suppliers having reduced their output, this has put more pressure on manufacturers and distributors in terms of availability.
“As most of the machines being sold are replacing old ones, the sales increase this year does not necessarily indicate a rise in overall construction activity. Nevertheless, in a downturn, contractors increasingly seek to cut capital expenditure by hiring equipment, and good local independent hirers have the flexibility to react quickly to this demand.We are also seeing increasing sales of our Cormidi tracked dumpers, which again are ideal for smaller contractors, as well as for tradesmen seeking to reduce labour costs and to improve materials handling efficiency.”
Jonathan Vaines, MD of Wacker Neuson Ltd, points out that “the improved reliability of modern machines has enabled hirers to retain old equipment for longer, especially when utilisation was lower. However, with signs of more activity amongst their customer bases, a point has been reached where machines simply have to be replaced.”
Used machinery in short supply
Yvette Henshall-Bell, UK & Ireland Sales Director with JCB Sales, agrees that, “having reduced their plant fleets in previous years, many hirers have all been wanting to buy their new machines at the same time, putting pressure on supplies, and with much equipment having been auctioned and sold to overseas buyers, good used minis are also scarce.
Ammann Equipment says more hirers are adding Cormidi tracked dumpers to their fleets.
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