Recent studies and reporting from the construction and rental equipment industries have pointed to a robust construction marketplace ahead, creating strong opportunity for off-the-road (OTR) heavy equipment operators and owners. According to a spring 2018 report from leading analyst group Global Market Insights, Inc., the overall size of the construction equipment rental market alone is expected to top $140 billion in U.S. currency by the year 2024. This results, in large part, from the continued growth of emerging economies around the world; increases in income and standard of living in key regions that have driven new residential and commercial development, and also from a swell in reconstruction projects, including the retrofitting and modernization of existing structures.
Much of the speculative construction growth worldwide, however, has stemmed simply from the ongoing “urban explosion” of a planet that can’t stop building:
- Metro area and suburban expansion has continued to take flight in international markets across the globe.
- Non-rural living is predicted to lead to a stellar 9 billion inhabits by the year 2050 with two out of every three people residing in an urban area or accompanying adjunct cities, according to the Construction Owners Association of America (COAA).
Clearly, as the world population continues to surge, the global building and real estate development market will need to keep pace, which translates into more construction, OTR and rental equipment industry growth and product usage. In turn, this leads to potential skyrocketing growth for the OTR and industrial tire sector – and that’s good news for everyone in our collective business sector.
The more OTR heavy equipment that floods into the global development market, the more tires those vehicles will need to ensure the steady productivity to accommodate new job sites. This growth is reflected in wholly owned fleet equipment but also in rental equipment, which is a mainstay support channel for the OTR heavy equipment space. The ARA Rental Market Monitor portends roughly 4.5-5.5% growth in rental equipment usage alone for both this year and next (2018/2019 respectively).
But while predictions continue to bode well for a generally healthy construction and building development marketplace (necessitated by heavy vehicle equipment and OTR tire usage utilization), there are still problems plaguing the market. These include poor profitability, sub-par equipment performance on the job, improperly trained workers, and concerns over of the sustainability of the products and materials – including tires – used in the construction and related industries.
According to Global Insights, the “global financial crisis and economic fluctuations are the key factors hampering the construction equipment rental market growth. Lack of a skilled workforce to operate the machines coupled with the fluctuations in fuel price is expected to have a negative impact on the industry.”
On the rental equipment side, companies have struggled to manage increased costs resulting from aging fleets and the pressures of adapting and scaling operations effectively to meet the increased workload typical of any industry facing supply and demand challenges. But equipment performance issues also come heavily into play. In past reports, the COAA has cited “time spent waiting for materials and equipment” as a factor for declined productivity in the field, which in combination with other criteria, leads to shrinking margins and stagnating profits.
One viable solution to eliminating lagging or inefficient on-the-job productivity is to offer OTR operators integrated processes and products that bring solutions and answers to time- and budget-strapped field projects. And while there are many areas of the supply chain that can impact field performance, when it comes to OTR equipment, tire productivity is an essential link in the logistics chain.
Tires must perform and work effectively to keep a job site humming – and this includes ensuring that they remain flat free at all times. If the tire of an essential piece of OTR equipment goes flat, replacement can be a major (and dangerous) hassle. Operators can benefit from having go-to solutions for tire flatproofing, simply because tire protection impacts so many other avenues of production. While there are many solutions for a construction environment (including solid apertures and traditional air-filled pneumatics), tire-fill technology (commonly referred to as foam fill) offers innovation to help operators looking to ride the massive wave of new development.
Adding Tire Fill Service
For operators looking to kick up revenues, tire fill is worth consideration. Polyurethane tire fill can be easily pumped into any pneumatic tire to replace air with a resilient, synthetic elastomer core that will eliminate flats and can also help reduce tire wear, tear and denigration. Unlike air-filled pneumatic tires, poly-filled pneumatics can easily glide over construction site debris — nails, rocks, metal objects, glass and even rebar — without sustaining punctures. Essentially, poly-filled pneumatics remain virtually flat free. Additionally, tire fill presents a smoother ride for operators versus the rougher experience of sitting on top of solid apertures. Plus, filled tires can be recycled, reclaimed and even retreaded if handled properly.
Of course, no one product is a one-size-fits-all solution. Management of an OTR equipment fleet will be best served by seeking to integrate all tire and road care management needs. Offering end-to-end support can help your OTR customer maximize both logistics and bottom-line efficiencies. Product partners can help tire businesses better serve OTR customers, working with you to develop the right approach, giving you access and training on a host of support products and tools to help your customers reverse lagging productivity. This involves keeping tires properly sealed and flatproofed, even under rigorous performance and difficult road conditions, as well as weather and temperature extremes. Your shop might also consider offering tire and rim conditioners and industrial strength tire sealants to coat and safeguard expensive OTR tires from the premature damage.
Best Practices for Serving the OTR Segment
Keeping an ear on the ground when it comes to tire function and OTR fleet management will always pay off. Some advice regarding the addition of OTR tire solutions:
- Take time to frequently listen and really hear from OTR equipment drivers themselves. What are their concerns? How comfortable is their ride? What created their biggest in-vehicle safety scares and why? How do tire selections play a pivotal role in both comfort and performance?
- As the pace of new construction increases, so do worksite demands, timetables and pressures. Tire dealers can help construction operations stay nimble with well-maintained equipment to keep up with enhanced market growth.
- Keep up with and reference the latest data from the industry front lines on tire performance, in addition to human body and equipment axle impact based on tire selection. By comparison, poly-filled tires offer significantly lower g-force impact. According to TRC, Inc., the leading independent automotive proving ground in the U.S., this can vastly alter the driving experience. And, as managers of any long-term build or construction site know, keeping employees satisfied and happy on the job translates into tangible profit losses or gains. Tire service can add value in this area.
- Consider the indelible impact of weathering and temperature extremes. Tire and vehicle performance factors can vary greatly depending on heating and cooling factors. OTR tires can often benefit from additional services your shop can provide, including special conditioning to protect against cracking, corrosion and premature denigration of OTR tires.
Because tire malfunction results in nearly half of all fleet truck breakdowns, it can’t be emphasized enough how important it is to mind this essential aspect of a job site’s bottom line. Forward-thinking operators will appreciate working with a commercial dealer that offers them a full spectrum of tire care needs – helping them with planning for profitability (not just for the near term but for years ahead) to better take advantage of what looks to be promising and robust growth within the sector.