Chinese market high machine leasing analysis brief

The PAF has released the Global Aircraft Leasing Market Report 2024. The rental market for high-altitude working platforms (MEWP) has shown remarkable resilience and growth in the wake of the pandemic, and this article summarizes and explores the key trends, growth drivers and challenges facing the MEWP rental market in 2024, compared with previous years, and provides a forecast for the near term.

High tariffs imposed on Chinese-made machines continue to restrict the supply of certain models in the market, adding to market pressure. Rent increases by 5% in 2023 to compensate for rising MEWP procurement costs and inflationary pressures. Most companies expect rents to rise further in 2024, albeit at a slower pace, as maintaining customer relationships with high year-over-year growth becomes challenging.

MEWP rental market in China

China's GDP will decline by about 1% in 2023, and the forecast for 2024 is set at about 5%. The macroeconomic outlook for 2024 and 2025 is generally more optimistic than for 2023. Construction activity is expected to remain strong.

In 2023, China's MEWP rental market revenue increased significantly by 19.5% from the previous year. Driven by fleet expansion and improved utilization, leasing revenue reached RMB14.882 billion (€1.946 billion). Nevertheless, rental prices continue to decline due to increased competition, especially in major cities in eastern and Southern China.

The total rental fleet in China has increased to nearly 530,000 units, mainly including shear and fork aerial work vehicles (73.5%) and boom aerial work vehicles (25%). Driven by opportunities in emerging industries such as urbanization, maintenance and renewable energy, the market is expected to grow further in 2024 and 2025. However, leasing companies are expected to be more cautious about fleet expansion due to economic uncertainty.

In 2023, with the relaxation of containment measures and the resumption of downstream projects, the average utilization rate rebounded to 71%. While rents are expected to continue to decline, the rate of decline is expected to slow, with variations in regional rate changes. Overall, the market outlook remains positive, with building safety and efficiency awareness driving stable demand.