Spanish rental market enters recovery mode
03 February 2016
There was an upbeat mood at the recent ASEAMAC rental forum in Madrid, with more than 130 delegates hearing positive news about the recovery of the rental market after six years of recession. ASEAMAC used the event to promote initiatives designed to improve the performance of the industry.
On market growth, ASEAMAC said its most recent survey showed that more than 70% of Spanish rental companies grew their revenues last year and the same proportion is forecasting growth this year.
Around 77% of rental companies are expecting to increase their capital expenditure this year, reported ASEAMAC’s Lucía Delgado. The online survey remains open for Spanish companies until the end of March, at http://www.aseamac.org/estudios/alquiler2015.
The association itself is benefitting from the recovery. At the height of the recession, ASEAMAC had just seven members, but now, said association president Juan Torres, it has 40 members and more are joining; “Quite a lot of companies grew by 10% last year, and the association is growing faster than that”, said Mr Torres, “The market is starting from a low point, but it is still growth.”
The meeting in Madrid, held on 27 January, gave evidence of the upturn in fortunes, with more than 130 delegates, including rental members, non-members and equipment suppliers.
Mr Torres said much of ASEAMAC’s work was focused on providing rental companies with tools that will allow them to operate professionally and profitably.
The association cannot discuss or lobby on rental prices, but it has created a ‘cost of doing business’ guide that allows rental companies to properly evaluate all the costs that go into a rental price.
The guide, available from ASEAMAC for €50, comprises an Excel spreadsheet that steers companies through the various costs of operation. The guide was created with the engineering faculty at the Polytechnic University of Madrid and Aliner Consultores.
Also high on the list of priorities is a new accreditation scheme for rental companies launched last year, and which was championed at the Madrid meeting by José Manuel Rubias, managing director of Loxam in Spain.
Mr Rubias said ‘Level 1’ accreditation would demonstrate that rental companies operated legally, with the proper insurances, road-legal equipment, and social security measures in place for employees.
“We want our customers to feel confident about us as suppliers”, said Mr Rubias, who is also a vice-president of ASEAMAC, “It says to your customers, ‘I’m doing things the right way. I don’t know about others – go and ask them.’ This is a really strong message to give to your customer.
“The authorities want the market to regulate itself…and they have congratulated ASEAMAC for its initiative. We know the ins and outs of our business, so we should self-regulate.”
Under the system, ASEAMAC members will need to undergo a third-party audit every five years, and also submit the relevant documentation every year. There is an annual cost, but it is not high. “This is an investment”, said Mr Rubias, “not a cost.”
Juan Torres, who in addition to being ASEAMAC president is managing director of Barcelona-based rental company TST, also told delegates that the association had negotiated a new deal on the energy tax that all power generators in Spain have to pay. In the past the 5.1% duty - which applies to installations generating more than 100 kW - was rated on the value of the rental contract.
ASEAMAC has managed to get this changed to a calculation based on the rated capacity of the installation, the hours operated, and the national power tariff. This, said Mr Torres, will reduce the amount of tax to be paid.
There is still a question of who should pay this tax, whether it is the rental company or the customer. Mr Torres said rental companies were obliged to inform their customers of the tax, and add it to the quotation.
Later this year ASEAMAC will hold its annual general assembly, for members only, at which it will celebrate its 30th anniversary.