French rental market sees 1% fall in second quarter

The French equipment rental market fell by 1% in the second quarter of the year according to the latest ‘barometer' member survey by DLR, the French association for construction equipment distributors, rental companies and the material handling sector.

The 1% year-on-year fall is the first reduction for more than two years and follows quarterly increases of between 6% and 14% in the previous five periods.

DLR said rental companies were being affected by falls in construction activity, with projects started in 2011 coming to an end and not being replaced at the same rate. In addition, the French housing market declined in the quarter. The quarter was not helped by there being an unusually large number of holidays during May.

Equipment distributors reported modest growth of 5% during the second quarter, although the trend here is also for the market to slow, while much more resilient has been the material handling/forklift sector, where revenues grew by 13%.

DLR said all three divisions of its members - rental, distribution and industrial material handling -were anticipating a decline of activity in the third quarter. "The financial situation of construction companies has reached a critical level, comparable to that of 2008-2009", said the association.

The French government is developing a programme to boost housing starts, but DLR said this would only start to have an impact by the end of the year "at best".