General Manager's Message - Winter 2017
Wednesday 12 April 2017 @ 14:10
Welcome to another edition of Blue News, the magazine for Genie customers throughout Australia and New Zealand.
One of the biggest challenges facing rental companies in 2017 is the decision of what to do with 10-year old machines. In 2016, Genie Australia developed “Genie 360 Support” to provide fleet replacement solutions to this difficult challenge. As I see it, rental companies have two choices for a 10-year old machine: Replace it or complete a 10-year inspection. Both options have costs and benefits, and to be honest, most companies are opting for a combination of both.
When a customer choses the replacement option, Genie Australia will trade in the machine and replace with a new one. Customers are choosing this option when they want the latest technology, or they want to change the model mix of their current fleet. This option also allows customers to reduce the average age of their fleet, which is an important metric for measuring the future value of a rental business. New machines also come with full warranty, thus reducing maintenance costs. And, many customers are simply saying, “Interest on new machines is cheaper than maintenance on old machines.”
However, some customers are also choosing to complete a 10-year inspection on their machines. This allows them to use the machines for an additional five years before another inspection is required. Customers chose this option on some models where technology has not significantly changed over the past 10 years, and the machines has been reliable and remains in good condition. This decision is also impacted by machine ROI, as well as the utilisation/rental rate achieved on that model over the past 10 years. Genie Australia has state-of-the-art inspection facilities across Australia, and being the original equipment manufacturer, we know what is required. Contact the local customer support manager for a quote.
ROI has been another big challenge facing this industry for the past three years with utilisation often winning out over rental rates with the result being a less than acceptable ROI for most models. For the first time in quite a few years, though, most customers in Australia are commenting that they are very busy and expect that this will not change for the rest of 2017. Because of this long-term positive outlook, many customers are working hard to drive up rental rates to levels where an acceptable ROI can be achieved.
The age-old battle of utilisation versus rental rates will never go away, and often I think it is a lack of accurate information rather than the economy which has driven down rates. The U.S. dealt with the issue by independently reporting weekly rates by model, thus providing another source of information on which to base decisions. Long-term, I hope Australia can go down the same path as the U.S. and report average rental rates so that customers have another source of information from which to base their decisions.
Another way to increase rental rates is to design equipment that provides enhanced value to the customer. At the HRIA show in May, we will be launching the new Genie® SX-135 XC™ and Z™-60/37 FE boom lifts. The Genie SX-135 XC is a stick boom with industry-leading reach of 90 ft, and the Genie Z-60/37 FE is fully hybrid knuckle boom with excellent rough terrain capability. These products have been specifically designed to increase customer ROI by expanding their use, and this is only the beginning of what is to come with new products over the next three years!
Enhancing operator safety is another challenge the whole industry is facing with secondary guarding being a hot topic. Genie has just released its next generation of secondary operator protection on boom lifts. The new Genie Lift Guard™ Contact Alarm system is simple but very effective solution that now come standards on most new Genie booms. And, it can be retrofitted on most older machines. This new secondary guarding system will also be on display at the HRIA show and available in July.
Happy reading, and as always, if you have any comments you can call me directly at 0408 884461 or email me at email@example.com
General Manager Terex AWP Australia
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