Speedy not expecting quick recovery in UK

17 April 2009

Steve Corcoran, chief executive of Speedy Hire in the UK.

Steve Corcoran, chief executive of Speedy Hire in the UK.

Speedy Hire said it is preparing for a challenging market for the next two to three years, with the possibility that the worst of the UK recession was still to come.

Steve Corcoran, Speedy's chief executive, speaking at a UK press briefing in early April, said the company had "adjusted our mindset to a challenging market for the medium term, at least over the next 2-3 years.

"The construction market will continue to contract and there needs to be a contraction of the rental market. There is too much capacity for the size of market that currently exists and will exist in the near future," said Mr Corcoran.

He said there was a possibility that the worst was still to come; "the industry is increasingly reliant on long-term commitment from the public sector. The worst scenario is that public sector investment drops over the next three years before private sector demand returns, resulting in a double-dip recession."

However, Mr Corcoran said Speedy had prepared early for the downturn and that there was no current intention to make more cost cuts. The depot network has already been cut by 17%.

Fleet investment will be around £75 million in 2008/9 and around £450-50 million next year. "We're focussing our capital predominantly on power and engineering equipment to help us further enhance our offering to large customers operating in the industrial and infrastructure sectors, including those in nuclear, rail and utilities," said Mr Corcoran.

Meanwhile, Mr Corcoran welcomed the establishment last year of the CBI's Construction Council in the UK to lobby on behalf of the construction sector. Mr Corcoran, who is one of the 24 senior industry figures on the council, said it would help construction obtain support from Government; "In this recession, we've seen the ability of other sectors - sectors that employ fewer people and account for less GDA or GVA [economic output] - benefit directly from Government support.

"The construction industry's lack of unity has prevented it from accessing the same level of support, and yet it represents the best place for the Government to commit capital in order to get a return. The Construction Council - as part of the CBI - has a clear mandate from the industry to consolidate its interests and make its voice heard."

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