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Industry Overview 

The recovery of oil prices has positively impacted the Middle East economy. You will get complete construction solutions from UAE’s Leading Heavy Machinery Companies. Hence, the infrastructure sector spending has increased. The construction equipment and machinery market has seen renewed demands with new government initiatives towards development projects. Expansion of metro networks, airports, smart cities, hotels, and shopping malls has been a positive factor in addition to the Dubai expo 2020 for the construction sector.

Heavy Machinery Companies in UAE

According to industry statistics, the construction equipment market size in the Middle East will grow during the period 2020-26. Despite the Covid-19 setback, the UAE Government’s support for the construction equipment market has increased in financial packages. The UAE Central Bank has offered 50 billion Dirhams to each bank in the UAE at zero cost for lending as well has allocated a $27 billion (AED 100 billion) incentive package for local banks and SME’s. This stimulus package is directed to the growth of the construction in the next few years. 

Demand for Construction equipment 

The Middle East construction equipment market share is extensively dominated by earth moving equipment and mobile cranes. This equipment has a wide application in construction sites.  

Considering the nature of development in the infrastructure in the UAE region, this equipment is in great demand at construction sites is mainly used in excavation, lifting, and transporting heavy materials.

The demand for these types of equipment and other construction machinery is likely to rise. The need for new and used construction equipment means the existing major players in this segment playing a crucial role in the demand and supply chain. As a leading name in the business, Anwar Al Quds (AAQ) Machinery will play a pivotal role in the used equipment supply among the heavy machinery companies in UAE. 

The heavy equipment machinery market in the Middle East is likely to grow at 1.8% over 2020-26, and the construction equipment rental market has a projected growth rate of 3 % for the next five years. These growth indicators also mean increased demand for pre-owned or used equipment. 

The order book of the new equipment suppliers is healthy, which means the demand for used equipment goes up simultaneously. It is likely because construction companies replace their old depreciated fleet with new ones leading to a thriving second-hand market for construction equipment. This segment is highly robust as many contractors prefer to buy used equipment instead of going for a new purchase. Also, the demand for equipment on rentals has increased owing to market uncertainties. The contractors and even Rental companies prefer to buy used heavy machinery rent it out after refurbishing it. 

The economics of used equipment

One of the significant players in the market for used equipment, Anwar Al Quds (AAQ) has an impressive range of heavy machinery and construction equipment fleet. The idea is to provide a complete solution to the customers who may have requirements for different types and models of machinery and equipment. 

Various projects require different types of construction equipment. Hence, it may not be feasible for a contractor to go on a buying spree for new equipment. The capital exposure would be huge and may not be viable in the short term. It is a likely situation despite banks offering attractive loans for Used Machinery in Dubai.

Used Construction Equipment dealers help their customers save costs on equipment, shipping, and other add-on costs. The used equipment is refurbished, checked, and verified before reselling it to contractors and equipment rental companies. The inventory maintained by the dealers is impressive, with leading brands like Caterpillar and JCB always available at short notice. Apart from the mobile cranes and earth moving equipment, other types of machinery such as welding machines, Generators, compressors, forklifts, and road equipment in the inventory come well-maintained by companies like AAQ.   

Future trend

Presently, there is a push among the OEM (original equipment manufacturers) to widen the range in more than 100 types of construction equipment present in the market. The industry players feel that the disruptive changes will come faster than anticipated as the new models will be more customer-centric than operations-focused.

Final Takeaway 

The customer-centric approach in the construction industry underscores the fact that increased preference is opting for used equipment on a cash or rental basis. Hence, it works out best on the cost-benefit analysis for any particular construction project. The return on assets (ROA) is crucial apart from the cash flow. Large construction companies, SMEs, contractors, rental companies plan their operations based on the ongoing projects and the demand for project-specific machinery and equipment. This planning is crucial to ensure uninterrupted cash flow in the long run in this capital-intensive industry.