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Six rental companies among top 21 fleets in 2002 CE rankings
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| Rental companies occupy six of the top 21 places on Construction Equipment magazine’s 2002 Equipment Giants report, a ranking of companies based on the replacement value of their equipment fleets according to their own estimates (CE, September).
These six companies, with an aggregated fleet value of $10.76 billion, accounted for 28 percent of the $38.37 billion aggregated total for these 21 organizations, which represent all types of fleet owners – construction companies, mines, quarries, aggregate producers and even the U.S. Army Corps of Engineers, which tops the list with a fleet worth $3.5 billion.
But No. 2 is United Rentals of Greenwich, Conn. It reports a fleet value of $3.2 billion.RSC (Rental Service Corp.), including its Prime and Prime Energy rental units, comes in No. 5, with a $2.3 billion fleet.Hertz Equipment Rental Co. (HERC), Park Ridge, N.J., is No. 8 with $2.1 billion.
No. 17 NationsRent of Fort Lauderdale, Fla., places its fleet value at $1.1 billion.
No. 19 NES (National Equipment Services) of Evanston, Ill., has a $1.06 billion fleet following its acquisition of Brambles.
And Sunbelt Rentals, Charlotte, N.C., comes in No. 21 with a fleet worth $1 billion.
So what about Caterpillar? The Cat Rental Store does not show up on the list because Caterpillar’s rental initiative is based on ownership by independent dealers; these companies are not incorporated as a Caterpillar business unit.
Anybody who’s followed CE’s Equipment Giants ranking for a number of years and hasn’t been paying close attention to what’s been happening will find one other revelation by far the most noteworthy: namely, that there are rental companies on this list at all.
Twenty years ago, even 10 years ago, it would have been fantasy to imagine a rental company among the top 21 fleets, much less No. 8 or No. 5 – No. 2, unthinkable.
Bear in mind that these rankings are based on the replacement value of equipment fleets as reported by the companies themselves.
The high ranking of these large rental companies is all the more remarkable when you consider the financial difficulties that have hammered them over the past couple of years, and in one case – NationsRent – brought on a restructuring under Chapter 11 protection.
Of course, they had to build up large fleets of new equipment to compete with each other, and the cost of that has had a profound impact on their balance sheets. This and the costs of acquiring rental companies were major contributors to the highly leveraged positions of these companies, which made them so vulnerable to the economic turndown.
But still, the presence of rental companies this high up on this list, from a historical perspective, is remarkable – no matter how you qualify it or how many footnote disclaimers you tack on.
Rental may not yet be the 800-pound gorilla in North American construction that it is in the United Kingdom or Japan, but it certainly is headed in that direction. RM |
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