German rental market not consolidating, says Jürgen Küspert

Germany’s construction equipment rental sector is not experiencing the same consolidation trend as other major rental markets in Europe, according to Jürgen Küspert, the managing director of bbi, the German association for rental, construction equipment dealers and material handling companies.

Speaking at IPAF’s Summit conference in Berlin on 20 April, Küspert said the highly fragmented nature of Germany’s construction sector meant that there continued to be a demand for rental services from small, local rental players.

Jürgen Küspert, managing director of bbi, speaking at the 2023 IPAF Summit in Berlin. (Photo: Joe Mather/IPAF)

“I’m fully convinced that the fragmented structure of rental is a result of the fragmented customer groups”, he said. “The small contractors do not want to be in contact with the big rental companies – they often want to work with the local companies, their neighbourhood companies.”

Some 88% of Germany’s contractors employ less than 20 people. Only 0.4% of contractors have more than 200 employees.

He said that in the past eight years there had only been 25 rental acquisitions in Germany; “That’s not what I would call consolidation. I don’t see it in the next few years.”

Küspert also challenged the idea that Germany is not a major rental market. He said the country was home to more than 4,200 companies who have rental activities, with 950 of these achieving rental revenues of more than €1 million, and 68 with annual sales exceeding €10 million.

“There are lots of small, regional players, who are very strong in their cities and towns”, he said.

Küspert added that the current uncertainty in Germany’s economy was encouraging some contractors to rent more equipment. Bbi is forecasting that the general rentals market will grow by 5.5% this year, with the access rental sector up by 5%.

“Construction companies are very uncertain about what will happen at the end of the year. To rent is a good alternative to owning.” He added that contractors were “not sure whether owning [electrically powered machines] is a good idea. Rental companies can test them for contractors.”