Middle East. Tracked platforms. Truck mounts REGIONAL REPORT: INTERVIEWS - TVH & PLATFORM.AS; SCAFFOLDING INTERNATIONAL; BAUMA CHINA PREVIEW

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1 Volume: Twenty Three Issue Six September-October 2016 A KHL Group publication Tracked platforms Truck mounts REGIONAL REPORT: Middle East Official magazine of IPAF INTERVIEWS - TVH & PLATFORM.AS; SCAFFOLDING INTERNATIONAL; BAUMA CHINA PREVIEW

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3 The Middle East has already proved itself as an active AWP market; now it is taking the next step into maturity. Euan Youdale reports. Firing up It has been in the last few years that the Middle East has really shot into prominence as a wide-ranging user of access equipment. Although some of the markets that make up the region have matured more than others, in terms of access. Paul Rankin, managing director of rental major Rapid Access, says the Kingdom of Saudi Arabia (KSA) has seen the biggest expansion in the region over the last three to four years, thanks to contractors entering the country and developments in health and safety. From 2008 onwards the government began making significant and sustained investments in large scale infrastructure projects covering metro projects, airports and the expansion of the country s oil & gas and petrochemical industries, says Mr Rankin. As a result, Rapid, which has a regional fleet of 4000 units across all it nine depots, is expanding its depot network to support key projects and clients. Given the geographical scale of some of the GCC countries, the Rapid Access at work in the Kingdom of Saudi Arabia. JLG booms rise to the roof. distance between cities and key projects is substantial. It is only by investing in new depots that we can ensure that both equipment and service solutions are available. Ewan MacAngus, developing markets director at JLG Industries, agrees Saudi Arabia is probably the biggest market due to the volume of projects. Although he adds, I would suggest emerging is subjective [as a word] when related to the region. The UAE, where AWP s were first introduced, is still in the emerging phase as an access market. Up to the end of 2015 Saudi Arabia was Genie s biggest market in the Middle East, with UAE, Qatar and Kuwait, following in that order. If you take the numbers from 2013 to 2015 the market in Saudi has almost tripled, says Sharbel Kordahi, managing director for Terex material handling and AWP, Middle East and Southern Africa. Although there has been a significant drop this year of about 50%-60% generally, and as far as Genie is concerned, around 35%, adds Mr Kordahi. Oil influence David Hall, product and business development manager, Skyjack UK, says oil is a major factor in the drop. The price of oil has a major effect on the economics of the region, when the price is low projects can be delayed and this in turn impacts demand for access equipment. Political instability is also a notable issue, The government is spending in other areas, more on the defence side rather than infrastructure and other relevant projects. Contractors have not been paid and so they are not investing, adds Mr Hall. Mr Kordahi continues, I don t think there will be a big impact or big change in 2017, I think we will continue to see the same conditions in the market, the oil price will still be around the $50 dollar mark. Also, we could > SEPTEMBER-OCTOBER 2016 accessinternational 27

4 INTRODUCING TELEHANDLERS The Middle East market is probably one of the toughest environments for construction machinery in the world, with dusty, high temperatures and high humidity conditions that provide a challenging environment every day, all year round. Since their launch at the start of 2014, the latest generation 14m working height T40140 and 18m T40180 telehandlers from Bobcat have been successful in the Middle East, says the company. This is borne out by feedback from three new customers in the Oman capital of Muscat, all of whom have recently purchased T40180 models, their fi rst ever Bobcat telehandlers, from Authorised Bobcat dealer in Oman, International Heavy Equipment. All three customers use their T40180 telehandlers for applications in the construction of houses, fl ats and other types of property. The fi rst customer, Blue Crystal International, has had its T40180 telehandler the longest with well over 3000 working hours already recorded. Abu Thalal Al Subhi Trading also has a new T40180 telehandler and uses it in a similar manner to the machine at Blue Crystal International. Malik Leeshanri & Partners is the third new T40180 customer in Muscat and primarily uses the machine with bucket attachments but also for lifting work with a hook on site and pallet forks for loading and unloading trucks. A Rapid Access platform, this time in Kuwait. see a different mood in the region with the end of certain conflicts like the war in Yemen. It seems its heading towards that direction now with peace talks well advanced. Mr Kordahi believes there around 5000 units in the main Saudi rental market, with perhaps an additional units owned by small rental companies and end users. In general the Middle East is all about booms and much less scissors, in contrast to most other AWP markets. The ratio is around 60%/40% booms to scissors. We are looking at construction and oil and gas focused industry, so these projects require many more booms and rough terrain products than they require electric scissors. Nevertheless, the use of electric scissors is increasing, It is not increasing with the speed that we want it to, but as the market matures we will see more of a need for indoor products and scissor lifts specifically. But that s more like in a couple of years time, adds Mr Kordahi. Moreover, the market is five to seven years away from being close to one of the more mature aerial markets like the US or Europe, which are both more rental focused. Our markets still have a high proportion of end user requirements. Again the figure is around 60%/40%, in favour of rental over end user. I think many contractors and end users understand now that our product is a rental one and they changing from buying fleet to renting it. Big players Rapid Access is dominant in Saudi Arabia, with Hertz Equipment Rental also a major player, along with United Gulf Rental and Access Rental Gulf, part of the AFI group of companies. Talking about rental across the region, Mr Rankin explains there has been a considerable cultural change as the region has moved towards renting assets over ownership, with the pace of change accelerating in recent years. In line with this we are seeing an increasing number of end users, who may in the past have purchased AWPs looking to hire equipment on a long term basis from recognised specialists like Rapid to ensure the equipment is well serviced, they maximise uptime and focus their own financial capital on their core business. In a similar vein, the company is taking a larger number of service contracts from owners of equipment and in partnership with a number of the OEM s to ensure that those who have invested in AWPs keep them maintained. As penetration continues we are seeing an increase in shorter term hires in line with market maturation and use in a wider array of applications outside of large scale construction. This leads to a regional reduction in hire periods, against an increased number of total machines on hire. 28 accessinternational SEPTEMBER-OCTOBER 2016

5 Booms above There are, again, more booms than scissors in the UAE, however, the difference is a bit less than in Saudi Arabia at around 55%/45%, says Mr Kordahi, with the UAE continuing to mature faster than the Saudi market. This is mainly due to the UAE adopting access earlier than its neighbour. Up to , Saudi was a secondary market for all manufacturers, only after the global crises did Saudi start becoming a major market, adds Mr Kordahi. With maturity comes a larger quantity of younger and new machines. In recent times most users were happy with machines eight to 10 years old and unwilling to pay new machine prices. We see a big change in consumer behaviour. Now, most end users, particularly on major projects would not want a machine more than three to five years old. For example, Mr Kordahi adds, One of the biggest rental companies in the region had almost 99% used equipment, in a year-and-a-half that has changed and they are looking to balance their fleet with new machines. Mr Kordahi adds that this year there is a big appetite for access platforms in Qatar and Kuwait. The projects that have been waiting on execution there for some time are now maturing. Is it likely that manufacturers of AWPs will spring up in the region? I don t think it will > No Boundaries The UAE is particularly relevant to this process. Mr Rankin believes it is the biggest market in the region, with around 5500 units making up its rental fleets. All of the regional markets have experienced significant growth in recent years driven by the construction industry and increasing AWP penetration but the UAE has stayed in a leading position.. As well as Rapid in the UAE, Manlift, Johnson Arabia and Access Rental are also big players there. The UAE was the first market where the use of AWP s began to develop and was the first place in the region where Rapid Access established 20 years ago. In the last 10 years all of the GCC markets have made improvements in the health and safety environment but the UAE has led the way in many aspects. There are a great number of large scale infrastructure projects underway including Abu Dhabi airport where there is an estimated 700 aerial work platforms, or more, in operation, says Mr Rankin. With Dubai set to host the Expo 2020 we expect the levels of activity to continue as the Expo area is a Greenfield site and incorporates an extension to the city s metro and a range of additional building projects. Skyjack doesn t have any Middle East based facilities, rather, We provide excellent coverage cover with help of our dealers, says Mr Hall. We ll Keep Breaking The Boundaries. Where You Go After That Is Up To You. Whether you own one Aerial Work Platform machine or manage an entire fleet, battery performance matters. And when it comes to deep-cycle batteries, no one goes to the extremes of performance like Trojan. Our full line of deep-cycle flooded, AGM and gel batteries will take you to heights you never dreamed possible SEPTEMBER-OCTOBER 2016 accessinternational 29

6 JLG booms carry out construction work. be a threat to us as a manufacturer, says Mr Kordahi. He believes if manufacturers were to appear it would be for products at the lower end of the working height spectrum, perhaps push rounds and smaller personnel lifts. But the higher end scissors and booms; I don t think that will happen in the near future. Mr MacAngus adds that used machines are still being deployed in the region. Although in lower numbers than previous, mainly as a result of prohibitive ownership costs, increased safety guidelines and directives from the oil and gas sector on the age of products being used in that particular industry. At Skyjack Mr Hall agrees there is a movement towards newer machines, as customer expectations are increasing together with the growing demand for higher specifications. Although, he confirms, The price of oil has a major effect on the economics of the region, when the price is low projects can be delayed and this in turn impacts demand for access equipment. Mr Rankin adds, Right now the fastest growing country for MEWP s is probably Qatar where the Qatar Metro project and the investment for the Qatar World Cup 2022 is beginning to pick up pace. Closely followed by Kuwait where the relatively small AWP industry is poised for expansion on the back of significant oil and gas investment and the recent award of the new airport terminal. In years to come Mr Rankin expects to see a developing AWP industry in Egypt, Iraq and in time Iran, where the level of investment in oil and gas and infrastructure, key sectors for AWP s, is expected to be significant as the country continues to open up. Average prices Unlike in other maturing markets the cost of new machines is no longer at a premium in the Middle East. Today, with international and global companies coming into the region you don t have a lot of space for manoeuvre, they know their pricing in Europe and they compare it to what s happening in the Middle East. As far as equipment is concerned, products are not designed specifically for the Middle East region. JLG, for example, offers standard machines with certain options fitted, primarily to address the extreme climate during summer months. Nevertheless, the choice of equipment used in the Middle East is significantly different to that found in markets such as Europe. Mr Hall adds, There is demand for a wide range of equipment but some areas with large oil and gas related facilities have demand for larger booms especially during shut-down periods. >

7 Mr Rankin explains, the mix in the GCC is very different to the UK and Europe. A much smaller proportion of our fleet are electric scissors and booms. The largest section of our product range is mid-sized diesel booms in the 22 to 27m range. Mr MacAngus adds, Product mix across the region basically reflects rental demand. As a result, the majority of products are above 20m The Genie SX-180 working at The King Abdul Aziz Centre for World Culture with a higher than average population of 28m and Ultra Boom products, when compared to a typical rental fleet in Europe. Genie confirms the products in biggest demand are telescopic booms in the 65ft to 125ft working height category, unlike in Europe and the US where 45ft machines are far more common. We don t design anything specifically for the Middle East, although we do add on products to take into consideration temperatures, harshness of the weather, but not machines specific, more option specific, says Mr Kordahi. As previously mentioned, the main driver behind a specific choice in working heights over others is the type of projects being undertaken, and the earlier penetration of AWP for work above 15m. Mr Rankin adds, When you are working at 15m in an outside environment there is little doubt that an AWP is the safest and most efficient way of working. On lower height areas of work and often for internal applications more companies may tend towards traditional methods including scaffold solutions. Safety conscious Safety is increasingly a significant factor in the region according to Mr Rankin. A large amount of equipment from Rapid is provided with the safety and productivity enhancing accessories available from the Lavendon Group s BlueSky systems. All of Lavendon Group s depots are subject to its TechX2020 inspection, meaning that whether in Riyadh, London or Paris all depots deliver the same level of technical and customer service. Concerning standards, there are no locally developed standards, says Mr Hall, but CE specification is becoming more popular as main contractors and oil companies are now requiring load sensing systems. JLG operates a typical JLG SSO structure in the region without the finished goods facility. So our focus is on sales and aftermarket support, not necessarily in that order of importance, says Mr MacAngus. Nevertheless, across the GCC, regulations and standards are developing but at this time most are being set by client groups for specific industries and projects rather than at a government and national level, explains Mr Rankin. Mr Rankin adds, This July saw the release of the first national level guidance on the use of MEWPs and required training when OSHAD (Abu Dhabi Occupational Safety and Health Centre) published a new Code of Practice providing guidance on the need for thorough training of AWP operators in accordance to international training standards such as the IPAF. He adds, We work closely with IPAF across the region, accounting for over 60% of the regional IPAF cards issued, and as such are involved along with other regional suppliers in working to establish regulations that will enhance the safety of the regional industry. Mr MacAngus agrees IPAF is active in the region, but adds, It is generally accepted change has to come from within and through the local IPAF council they are working to implement international standards with the relevant government and industry bodies. So in this respect regulations and standards have come a long way, with some way still to go. So, the future is bright in the Middle East with the number of applications developing all the time. Construction and oil and gas forms the bulk of projects. But MacAngus adds, Large fit outs on the likes of an airport, facility management and warehousing are some of the new sectors being developed as a result of productivity gains and the introduction of safety guidelines. Regionally the success of our Power Tower range highlights advances being made in the lower level access sector. AI GET YOUR TICKET NOW! 32 accessinternational SEPTEMBER-OCTOBER 2016