Consolidation in the powered access industry is likely to continue to a point where, within the next ten years, the market will be dominated by a few global companies, according to Kevin Appleton, Chief Executive of Lavendon Plc, Europe's largest powered access rental company.

Delivering the keynote speech to delegates at APEX [12 September] in Maastricht - claimed to be the world's largest access equipment event - he stressed the need for the industry generally to attract the highest possible calibre staff and make major and sustained investments in training and improved service levels. The goal, he said, must be to achieve world-class service excellence throughout the industry if its growth goals are to be realised.

He considers the most developed markets in Europe to be the UK, Germany and France. The UK is believed to have around 25,000 units; Germany and France are reckoned to be in the order of 18,000 each. Market growth in recent years, Kevin Appleton stated, has run at between ten and 15 percent in the UK, where powered access currently represents approximately 20 percent of the access market. This compares with Europe generally, where to date it has achieved less than ten percent penetration.

Lavendon is though predicting significant growth across Europe in the coming years, with increasingly stringent health and safety legislation and the commercial pressures to reduce project times being cited as two of the most important driving factors. According to Kevin Appleton this will see the more successful of the national players becoming increasingly international, with the focus switching away from the too prevalent product focus to a service and performance based culture that delivers added value for the customer.

Returning to the subject of globalisation, Kevin Appleton sees the ever-increasing pressure to perform consistently across international boundaries, coupled with the need to generate earnings for fleet replacement and access to capital as sounding the death knell for the majority of small local operators.

"There will always be small companies that will meet the limited needs of local customers," said Kevin Appleton. "However, the volume end of the business is demanding consistently high standards of product availability and service across international boundaries. I can certainly see a time - in the next five to ten years - when Lavendon's European fleet, for example, will be between 35,000 and 40,000, compared to 11,600 today."

Commenting on the current overcapacity in Europe, he sees the recent announcement by one of France's largest suppliers that it has increased prices by as much as 30 percent as an indication that there is growing realisation that fleet investment and fleet maintenance levels can be sustained only by generating a reasonable return on investment.

He concluded his keynote speech by saying; "For the European market to grow, the industry needs to focus on selling the very real benefits of powered access. Fleet investment is important, but so is investment in providing the most efficient and professional customer experience time after time."

END

September 2002 Nat2.055a