The global value of the power equipment rental market is forecast to expand from $8.7 billion in 2014 to $17.4 billion by 2020, representing a Compound Annual Growth Rate (CAGR) of 12.3%.
The company’s latest report* states that the Middle East will witness the highest power rental market growth globally between 2014 and 2020, with its value doubling from $1.4 billion to $2.8 billion. This represents a higher CAGR of 14% compared to all other regions, which see their markets increase at a combined CAGR of 11.9%.
Provided that it remains the 2022 FIFA World Cup host, Qatar will lead the Middle East, with its own power rental arena expanding at a CAGR of 18.5% from $225 million in 2014 to $622.2 million by 2020. The United Arab Emirates (UAE) and Saudi Arabia will follow, with respective CAGRs of 13.1% and 10.3% over the forecast period.
However, Siddhartha Raina, GlobalData’s Senior Analyst covering Power, says that Qatar’s exponential growth may be restrained if the country loses the chance to host the World Cup, following allegations of bribery in the bidding process and the subsequent resignation of FIFA president Sepp Blatter.
Raina says: “With the World Cup planned for Qatar in 2022 and the 2020 World Expo in the UAE, significant investments have been made in these countries’ infrastructure development. These include Qatar’s investments of more than $200 billion in developing its rail and highway network and ports, in turn boosting its power rental market.
“On the other hand, losing the World Cup could significantly impact the planned flow of such investments and government spending directed towards the country’s large-scale infrastructure development and construction sector, subsequently hindering the predicted growth in its power rental project revenues.”
The analyst adds that even if the World Cup proceeds in Qatar, several barriers will still hinder further growth in its power rental space by 2020, including stringent emission standards to help counter its environmental challenges.
Raina concludes: “High efficiency and emission standards mean that Qatar’s power equipment rental market, which predominantly depends on diesel-powered generator sets, will face obstacles in terms of upgrading current equipment, resulting in added costs for owners.”
