Chinese rental company aims for national coverage

One of China's biggest equipment rental companies is planning to diversify if product range beyond road building equipment with the addition of aerial platforms, portable compressors and generators next year.

Xuzhou Gongli, based in Xuzhou, Jiangsu province, has been renting road building equipment since 1996 when it was part of the Chinese manufacturer XCMG. It has been a separate company since 2002 and a Dynapac dealer since 2003, and now has a fleet of around 300 rollers and pavers.

Mr Wang Yuhai, Gongli's general manager, told IRN that the company had attracted RMB 150 million of investment capital which it would use next year to diversify its product range and open new depots.

Around RMB 50 million will be spent in 2012 on new fleet, including as much as RMB 10 million on its first aerial platforms. Gongli was using the BICES show in Beijing to talk to prospective aerial platform suppliers.

In addition, the company will move into compressors and generators and other, smaller equipment like pneumatic breakers, rammers, plate compactors and concrete saws. It is considering adding skid steer loaders and mini excavators in a few years' time.

The company currently has three rental locations but plans to increase that to 20 within two years, with the ambition of offering an almost national rental service.

Gongli is unusual in China both for its size - annual revenues are around RMB 80 million - and because of its focus on road building equipment. Now it is intent on becoming a more diversified rental group.

Mr Wang told IRN that after many years of rapid growth - revenues have more than doubled since 2008 - the company has seen a slowdown in demand this year because of a reduction in public investment. He said the company's revenues would fall by 3-4% this year before growing again 2012 as a result of investment in the fleet and geographical expansion.