![](https://equipmentindia.com/uploadImage/870936dbb8c7856be42a4db577fc90fc.jpg)
Limited market awareness hinders rental service penetration
Can you provide an overview of the services offered by Atlas Copco Rental in India?
Atlas Copco Specialty rental provides equipment for oil free air, on site nitrogen generation, steam generation, and power on temporary and long-term rental. Our customers choose us during planned contingencies and emergencies; we also provide tailored services according to specialty solutions needed by our industry. We see an emerging trend for customers taking our services to meet their changing demands.
Can you provide an overview of the current landscape of the construction equipment rental market? What are the latest trends you’re observing?
Over the last decade, the rental industry landscape has seen many dynamic shifts, both in terms of technology as well as innovation. While the construction and mining industry would use more diesel engines driven equipment traditionally, electric machines have now started taking the spotlight and we have designed products with sustainability in mind.
We have developed solar-powered light towers, E-Air electric mobile compressors, ZenergiZe energy storage range etc. At Atlas Copco Specialty Rental, we have earmarked these evolutionary trends, identified micro and macro-opportunities, and designed groundbreaking solutions to overcome hurdles, achieve goals and engineer change.
This is clear from the number of projects we have spearheaded such as world’s largest refining hub in India, strategic crude oil storages, off-shore - deep sub-sea pipeline, construction of mega fertilizer plants, and special application during construction of sea ports. Production of ventilators during Covid to an Indian Government entity, supporting major vaccine players during an emergency for production of vaccines.
If we talk about the future for rental in Indian market, we are optimistic about it. This largely comes from the fact that India is seen as the fastest-growing economy in the world and is on its way to become the third-largest construction market globally. Infrastructure sector is a key driver for the economy as it is this sector that is confident in propelling India’s overall development and also receives undivided attention from the Government for developing crucial policies that would ensure strict adherence to time and quality, maintaining high standards and offer world-class infrastructure.
This sector includes power, bridges, dams, roads and urban infrastructure development and even though the construction equipment leasing is still in a growing phase and accounts for 6 to 8 per cent of the overall construction equipment market, there are many indications that there is soon going to be a turning point in this data.
What are the key growth strategies Atlas Copco Rental is employing in India, and what is your future roadmap?
Atlas Copco Rental is focusing on customer needs by expanding across India with satellite depots. We’re investing in digital infrastructure to technically monitor the fleet at remote construction sites to ensure reliability and uptime and to support new models adapting efficiently and effectively to our customers demand of being asset-light by providing variable long-term rental solutions. Soon, our Bengaluru depot will commence operations. We’re seeing increasing interest in our BOOM (Build, Own, Operate, and Maintain) services from customers. Additionally, we're launching into the heating and cooling sector, starting with rental steam boilers.
In a world marked by constant and radical change, success can no longer be measured in rupees, dollars, or euros. As the world becomes more complex, our customers will be facing more challenges. In today’s VUCA world, business is becoming uncertain and unpredictable due to geopolitical situations, climate change, and changing demand. Rental in India is prepared to offer long-term variable solutions to help our customers be more agile and resilient in the face of uncertainty.
Our long-term variable solutions for air, steam, and onsite nitrogen generation through our new business model, BOOM, will be a game changer. As Atlas Copco Specialty Rental, we solve complex industrial challenges with specialized agile solutions. Our new strategy supports the foundation for this future growth. More than 1,000 passionate specialty rental people worldwide are continuously designing and implementing the best new ways to solve complex industrial challenges every day.
What challenges do construction equipment rental companies currently face in terms of market competition and demand fluctuation?
In the capital-intensive rental business, access to capital remains a challenge for small and unorganised players. Loose regulations, project cancellations, and delays exacerbate financial uncertainties for rental companies. Atlas Copco focuses on the specialty rental market, which is currently fragmented. Few major players dominate the industry, leading to low rental penetration. To address this, a mindset shift is necessary. Small rental companies in India are diversifying and investing in energy-efficient technologies to enhance customer experiences and overcome the rental industry’s penetration challenges.
With the rise of technologies like IoT and AI, how do you see them impacting the construction equipment rental industry?
No section of industry is untouched by advancement of digital technology and rental companies are not exception to it. With advancement in IOT our fleet is connected, and we can ensure better uptime to our client with greater operational efficiency.
Finance is often a significant aspect of running a rental business. What are the key finance challenges that construction equipment rental companies encounter, especially in today’s economic climate?
As the market leader and an OEM, Atlas Copco actively engages with our customers and strategically invests in technology to design our rental fleet according to emerging trends. This approach ensures the financial stability of our operations. In the capital-intensive rental business, substantial investment is required to build and maintain a fleet that meets customer demands.
Clients seek asset-light solutions and rely on rental companies to provide timely services. Access to finance is critical in this industry. While today’s liberal economy offers opportunities, rental companies must prioritise informed decision-making before fleet investments. Clarity of goals, rather than opportunism, is essential for long-term success.
Could you elaborate on Atlas Copco’s specialisation in providing tailored rental solutions, particularly in sectors like Manufacturing, Mining, Oil & Gas, Power & Plants, and Offshore industries?
Over 150 years of research, development and testing against the real-life industries and environmental conditions of over 140 countries in every corner of the earth. Atlas Copco Specialty Rental India is ready with the world class, state of-the-art diverse fleet to suit many applications – onshore or offshore, oil lubricated or oil-free air, onsite nitrogen, power generators, steam boilers or their accessories.
We have a wide range of rental fleet comprising of our inhouse legacy products designed and built only for rental purpose to name a few PTE 900 VSD, PTS 800, PTS 1600, PTE1500, PNS1250 and high-pressure boosters which are our legacy products. Other than that, we have energy efficient diverse fleet to suit many applications. Our Zone 2 air compressors are designed to operate in hazardous environment. Our modular approach and ability to provide end to end solutions with all the related accessories, we are highly competent to provide turn key and total solutions to our customers in any industrial segments. Whatever the business requires, it might be time to consider our total rental solutions.
Rental challenges such as equipment maintenance, logistics, and customer service are crucial for the success of rental businesses. What strategies or best practices do you recommend for overcoming these challenges?
Outlook of the market is positive. The overall policy thrust may not change much with a major headwinds specialty rental has different challenges. Limited market awareness about benefits rental services are limiting rental penetration in market. Logistics and infrastructure hinder efficient delivery and return of rental fleet. Cultural factors like traditionally industry is still inclined towards ownership mindset, which is changing at a fast pace, but still not many companies are going asset light currently by estimates our rental penetration is in single digits unlike 50 to 90 per cent rental penetration for some equipment in developed economies.
Another good problem for us to have been supply chain issues with increasing rental demand we need more fleet and people which are in always in shortage. We are driving several initiatives to educate Industry by collaborating with industry associations and leveraging digital platforms for broader reach. Not just Atlas Copco Specialty Rental but even the Indian market is self-realising how important is to go asset light in this everchanging market demands in this volatile world.
To overcome logistics related challenges, we are going close to our customers by setting up satellite depots across India. We are nurturing young talent and generating employment opportunities within our limited capacity by imparting training to young engineers and technicians. We are proud to be an employee friendly organisation and our work culture and people centric policies are helping us to attract skilled personnel. We’re addressing some of our operational challenges by innovating and using technology. Gradually more and more of our rental fleet is now digitally connected and we've set up an uptime center to monitor our equipment on-site, which helps us optimise our service operations.