The Rental Roundtable: Striving for Higher Utilisation and Better Mobilisation session was an opportunity for the delegates at the recent Access and Handling Summit in Dubai to take a special look at the rental scene in the region.
The panel comprising Joe Keely, Executive Manager – AWP/ Johnson Arabia; Rob Cavaleri, Regional Training, Safety and Compliance Manager | Manlift Middle East; and Martin Newton, Technical Director for International and Middle East, Rapid Access was an absolutely top-level array of rental experts and veterans.
Together the panel moderated by CMME’s Stephen White discussed how we can strive for higher utilisation and better mobilisation in the market through the critical rental channel.
Stephen White (SW): Joe, I’ll start with you, what are your thoughts in terms of where we’re at now in terms of the market?
Joe Keely (JK): Well, AWP is my specialty and I think the market is growing but maturing. We at Johnson Arabia, are still very heavily involved in construction and we see some maturity there and in some other markets, and industries, and sectors.
SW: There was a feeling after the Expo that we might see a drop off. But the market seems to have beem stronger than I think a lot of people thought.
JK: Yeah, I think it did slow, definitely, but for us, it has picked up in residential construction areas. Saudi Arabia is obviously a big draw for equipment. But one thing I would say is that the UAE has had what I would call a second wave of construction if you describe its first wave as 2008 to 2011 with big ambitious projects. The second wave saw a lot of infrastructure for Expo of course. I think potentially now there is a third wave. With the legislation that the government is releasing, they’re attracting the smaller and medium enterprises, and there’s a lot of work in terms of logistics, distribution, smaller commercial areas. This third wave of construction is very good for us because we can work on the smaller projects.
Martin Newton (MN): I totally agree. Ultimately, being based throughout the GCC we see a lot of fluctuations in the market. But it’s relatively easy for us to mobilise across the GCC, which is very good. The market in the UAE is very good at the moment. There’s a lot continuity on projects.
Rob Cavaleri (RC): The UAE is the most advanced as far as maturity of the market. And that means it’s moving away from construction and more than in the other GCC countries into what we call the outreach acquirers of access equipment. We are needing to supply to alternatives to construction. Every year, you need to say, “Okay, what have you got in the fleet? What’s the market going to ask for?” Then you order more of that type of kit. It can be depending on the height or reach capabilities, and so on. We have approximately 30-40% currently in the UAE of electric machines. And I think it will take another 10 years before they get to 50% or above that.
SW: That’s quite low compared to other markets…
MN: Yeah, I want to go all electric but that’s a challenge at this time. Where I think we’ll go is more into a hybrid model, which will probably take another 10 years. And then we’ll be going to full electric.
SW: It seems quite slow compared to the rest of the world. Joe, what do you think?
JK: I think I do disagree slightly. I think it’ll be slower than the rest of the world. But honestly, I think because of the maturity and the projects getting smaller. If you look at, for example, the redevelopment of some of the existing areas, like Al Quoz or Minah Port, for example, they are established areas and I think they will be quicker to take on electric. And if you factor in the fact that we are now regenerating areas of Dubai and Abu Dhabi…
SW: While you’re right, we are seeing regeneration, but is the infrastructure there?
JK: By 2025 the RTA say that they will have an all-electric fleet of taxi vehicles and you’ve got the use of hydrogen fuels – I think there is a big project being finished in Abu Dhabi – so, I think that it will very quickly come up. I think it will slow, but I’m not sure it’ll be 10 years, I think it will be quicker.
SW: Martin, you are obviously dealing across region as well. How do you see the rate of progress elsewhere?
MN: Yes there are some big challenges and there are two different models but Saudi Arabia seem to be doing a lot of things as well (because of the Saudi Vision 2030 programme), not just with construction, but also generally and how the country is changing. I have been going to Saudi for 20 years and it is a very big market for us. So we have an understanding of new regulations such as SABR and all the rest of it. I would like think we’ve been in there long enough now to actually know what we’re doing. But even we get caught out sometimes.
JK: I think the energy demand globally is going to change and there will be a shift. And this region has always been the centre of global energy when you’re thinking of its exports. I don’t think that they’ll change that for their future plan. It’ll be the future of energy in terms of solar, in terms of nuclear, in terms of renewables. We’ve said that it might be slower than the rest of the world because of the infrastructure, but I think their ambitions will lead them towards being as fast as possible as they want to retain that area of expertise, which is energy.
SW: Rob, you’ve been in this market a long too. Are you seeing your customers’ habits changing?
RC: We see changes in the sales of equipment. And I think the larger projects which you see in other countries have different requirements, to a degree, on what they ask for compared to here. If you look at the UAE government’s own strategy, and we were at a sustainability centre in Al Quoz recently, I think it’ll be more than 10 years before they think about going fully into renewables and stuff like that.
SW: There is a lot digitalisation in the sectors that you guys are serving, do you you think that and other emerging technologies like AI are re-shaping this industry too.
JK: All of us as rental companies have only have one responsibility or one reason for existence – and that is to maintain the availability of a solution for the customers. AI and IoT will be fundamental in improving how well we can maintain equipment, how well we can make equipment available. IoT will help us with all sorts of inputs and data intelligence in terms of how that machine is performing, what maintenance it requires. And then AI plugged into that will allow us to forecast demand in terms of repair of that machine for demand in terms of where that machine needs to be deployed. Those two things will fundamentally change the way we look at availability and maintaining the equipment.
SW: Is utilising these technologies being driven in-house, or does this come from the manufacturing side and then you incorporate it into your own operation.
JK: A mix of both. There’s plaforms developed by every manufacturer. There’s also wide availability of the IOT products from other third parties as well. You can already get the great information from these systems in terms of maintaining your equipment. The AI element is still probably a little way off. But it exists.
MN: We have purchased some of these products and manufacturer products, and we just upgraded one to a new version, so we can see tracking of the information and utilisation. We can give that to the customer as a report. We can also see battery voltages… That is something that’s an on-going project for us and we’re looking at rolling it out on all of our fleet this year.
SW: Sometimes it’s lost in sort of translation that you still own this equipment, so you want to make sure this equipment is being used in the best way possible. Getting data from the equipment actually out in the field is useful obviously for the guys using the equipment, but also for you to make sure it’s being used properly. I assume, you can go back and then channel that feedback to the customer?
MN: I think it’s very useful from both sides. One, from the customer-side. We have a couple of large customers that use the utilisation reports. And they can actually save money by saying, Actually, we don’t need that machine. From our data side, it is really useful to monitor the machines particularly the batteries, and tires, and things like that.
RC: Telematics-wise, we have actually approximately 90% of the fleet using telematics. Don’t ask me to list them! And it’s potentially a list of 25 benefits for the customers, such as how many hours until the maintenance is due. At Expo 2020 we could extensively control who uses the equipment. Are they competent or not? Are they trained or not? Rather than asking on the phone where their equipment is, the customer can see where it is. With features geo fencing, if the machine goes outside an area where it’s not supposed to be, us or the customer can actually make a call and say, “Where are you taking this piece of equipment?” Geo fencing is not extensively used, but it’s used by bigger projects with multiple contractors on one site. You want to keep your machines secure especially when it comes to safety. We also have apps where customers can actually look at the type of machines that are available: the models, and their availability, for example.
SW: I also want to touch on the Year of Sustainability in the UAE. Are you guys actively working out how to approach it?
RC: So we have internal measures. Sustainability is a much stronger focus and so we have KPIs, for example, on what we can do. We pick ones that we can do well on. And at the moment, we have a strong focus on the quality of education and responsible production and energy consumption in workshops. One of the important things that rental organisations should be doing is educating and improving the performance of the suppliers as well the customers and bring awareness to them. So you may not be able to do everything yourself, but you can certainly spread the message.
SW: Given where you guys sit in the supply of machinery, the power is in your hands in terms to a degree?
JK: Yes, but there’s definitely more collaboration that’s required in terms of the rental industry. You look at America, you look at Europe, you look at India, they’ve all got rental associations. We require leadership like that I think. Well, not necessarily leadership but collaboration. For instance, there is a lack of representation in terms of the equipment rental’s position within construction.
I think what we haven’t yet done is found a voice that talks about what we can do in terms of sustainability. There are still barriers between us and having that conversation.
And while we can open the door, I don’t think we are brought in early enough, I don’t think we’re consulted with, because we don’t have that collaborative culture with them or with each other. And I think that’s important. I (actually) believe they (the construction industry) are looking for that sort of collaborative body in order to have a conversation about what can be done sustainably.
