I’m sure many of you would have been dismayed by the news of yet more upheaval in the north of the region over the course of October. It is too early to second guess what turmoil this will cause, but already I am aware that industry events, even in Saudi, have been forced to postpone as we digest the ramifications.
Supply chains are also likely to be more challenging in the weeks ahead too. I really don’t have enough space in the column to talk about the events in detail, so instead I think now would be a good time to evaluate the major forces at play as 2023 draws to a close in the industry. The latest disruption of course comes at a time when we may have dared to think the worries of Covid and the global downturn it exasperated were behind us. Our news sites and screens are reminder that we are not out of the woods yet.
In recent years, the industry has experienced significant disruption, brought about by a combination of internal and external factors. The COVID-19 pandemic exposed vulnerabilities in the global supply chain, affecting the availability of construction machinery parts and components.
Companies in the Middle East experienced delays and increased costs due to supply chain disruptions, but these were eased by a bounce back in activity driven by pent-up demand post-Covid.
Throughout 2023, we have seen that drop to normal levels and as a consequence, developing a resilient supply chain and exploring local manufacturing options are essential for navigating the disruptions we are facing – making the construction industry look more challenging as we enter 2024.
Economic headwinds, such as fluctuating oil prices and the geopolitical tensions, have affected government budgets and construction projects across the Middle East. These factors have led to delayed or canceled construction projects, impacting the demand for construction machinery. Industry players must adapt by diversifying their portfolios and exploring new markets.
But there is hope that the rapid advancement of technology could finally deliver the promises of the last decade. This includes the integration of IoT, telematics, and autonomous machinery. These technologies have improved efficiency, reduced downtime, and enhanced safety on construction sites. More than ever, companies that fail to adopt and adapt to these innovations risk losing market share and competitiveness. The technology is also expanding options in rental inventories, including more electric and hybrid options than ever before.
You would also hope that the drive for sustainability that these could support should also come more focused after the COP28 meeting – at least at a local UAE level. We’ve already seen changes to material transportation rules – and there could yet be more to come such as stricter rules on equipment and vehicle ages. Thankfully, like digitalisation, these seem mucn more in our control.
