Construction plant shortages start to bite

Aaron Morby 3 months ago

Contractors and plant hirers are struggling to secure new kit as the industry tries to gear up to lead the recovery.

For some types of smaller plant, manufacturers are now said to be quoting 2022 delivery dates.

The market is heating up rapidly in the North and Midlands where major projects are starting to get going as part of the Government’s stimulus package.

Extended delivery times threaten to undermine the Government’s push to get the construction industry investing with a newly announced 130% super deduction tax break for firms buying  new plant in the next two years.

One hirer told the Enquirer: “We are screaming for new gear, but it’s difficult to get.

“It may not be so bad for the major hirers, who as big buyers have pre-ordered a lot of kit, but as a smaller business trying to buy, dates are being quoted towards the back end of this year or even 2022.

Another regional civils business boss said: “I have seen six month lead times in my career but never eight or even 10 months.

“It’s gone mad. Good condition second-hand machines are now selling for more than they were bought for a year ago in some places.”

A spokesman for Euroauctions, which is gearing up for a four-day sale in Leeds, next week said: “Sourcing plant is becoming a big issue and we are expecting a bumper auction because of long lead times on new kit.”

The bottlenecks are most acute in the smaller end of the market with 1-3t excavators and small dumpers in short supply. But extending lead times are now becoming widespread across a broad range of equipment and machinery

One firm said: “There’s even four months being quoted on quick hitches and 7.5t tipper trucks are hard to find.”

The heart of the problem stems from the fact that construction equipment is a global market with the whole world being plunged into recession at same time with Covid. Now all major markets are coming back at the same time.

“Usually it’s only one part of the world but manufacturers cut production globally during the pandemic and now everyone is ramping up again and everyone wants machines,” said another hirer.

“Manufacturers told us they are having problems sourcing steel for machines so the knock-on effect is huge.”

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