Opening the ALH Conference & Awards in Miami keynote speaker Don Ahern said the North American rental industry should enjoy a strong 2015 but cautioned that a slowdown in the oil and gas sector could have a major impact.
He said the last 60 days had seen some evidence of a slower market, with one major Ahern Rentals customer in West Texas laying off 150 people and Xtreme and Snorkel also seeing a slight fall in order intake, to the extent that the group now has a new equipment inventory of US$6-7 million. He said Snorkel had last week layed off 15 people at its UK manufacturing facility.
“I would suggest we’ve been seeing a real upturn for the last three and half years. That’s a long time. Things can change in a dime”, he said. “A lot of equipment has been migrating into the oil and gas sector…what’s going to happen to all the equipment if the oil and gas sector goes soft?
“If there is a whole flood of equipment that moves back into the commercial side, that would reduce used equipment prices, utilisation level…that could be a real problem. How long will the uptick last? We’ve got to be cautious.”
However, Mr Ahern said there were many positives as well, with current good levels of activity and as many as 300 projects exceeding US$1 billion in value currently underway in the US. “There are lots and lots of major projects going on”, he concluded.
The conference is taking place at the Biltmore Hotel in Miami, Florida. The event includes an awards dinner, with winners to be announced in the evening. For updates see www.khl.com.