Loxam Powered Access CEO on equipment, costs, acquisitions and headwinds

The economic climate has shifted radically since AI last interviewed Paul Rankin, the COO of Loxam Powered Access Division (PAD) and managing director of the UK’s largest access equipment rental company Nationwide Platforms some two years ago.

“If we fast forward those two years, we’ve lived through some awful inflationary headwinds. From the cost of cash to increases in operating costs,” says Rankin, who has been at the helm of Nationwide since October 2020. Before that he headed up Loxam PAD’s operation in the Middle East, Rapid Access, for the previous six years.

The financial situation sits alongside a marked shortage in labour, which has affected all areas of business from drivers to engineers. “We’ve seen some huge increases in operating costs. We’ve gone through some horrendous labour shortages, with drivers, and we had to make a huge investment in an apprentice programme in the UK, and now we are facing shortages in the engineering function which we’re again addressing with apprenticeships.”

The bottom line, says Rankin, is an aging workforce compounded by the fact that attracting younger generations to the industry is no easy task. “So, there is a labour shortage which is also driving up salaries and driving up costs.”

Industry pressures 

Speaking more widely about the market, Rankin adds, “Not only have you got inflationary pressures, and cost of cash pressures, you also have some operating cost pressures. “If you look at the pricing of products back in 2019/2020 for powered access equipment, the price increases are 25%, maybe 30%.”

“Not only is the cost of cash costing you more, but the depreciation is also costing you more.”

Rankin is specifically talking about the UK here. However the central European market remains buoyant with countries like France, which is hosting the Paris Olympic Games this year, faring much better “France is good thanks to the Rugby World Cup last year and the Olympics this year. Two huge sporting events year on year means that is going to be a busy market for us and everyone.”

Nationwide Platforms

Rankin sees promise in the Middle East too, “We’re seeing Chinese companies confirming their move into the market now with Horizon Rentals being the first recently to state their intentions, but you can’t just turn up in the Middle East and believe that you can do business there overnight.

“The landscape is changing, with new legislation coming into effect especially with increasing focus on best practice working, safety and greener energy as they adapt to reduce their reliance on oil sales.

“This legislation plays to our strengths, this is our value proposition as a business, it is very similar to the changes that happened years ago in the UK, but this is how we do business consistently. We know our customers in the Middle East, we have a steady management team that has been in place for many years, we are not concerned about the Chinese rental companies arriving in the region.”

Loxam Group also saw a shift into the South American market in 2023, acquiring A Geradora and Motormac Rental, consolidating its presence in the Brazilian equipment rental market and doubling its revenue in the country.

On the product front Rankin says he is very excited about the new eletric equipment being introduced to the industry, having invested in two 42 tonne full electric articulated delivery trucks in recent months. However, the economic and labour issues are also reflected by product investment. “Whether it’s products or transport, we’re still making huge investments but we’re not getting the rental rates to support the return on the capital cost that we did two years ago.”

A full electric truck costs three times that of a diesel-powered version, and “It’s the same with hybrid technology which costs 15% more. The rental rates are not going up 15% to cover that.”

Indeed, in the UK, as an example, rental rates are on their way down. “It’s bad on bad, to be brutally honest, so it’s a huge challenge, and it’s unsustainable.” Rankin adds, “We thought wrongly that the war in Ukraine would not last very long but it’s now just over two years.”

One major area that Rankin is focusing on is specialist applications to lessen the effects caused by the cyclical nature of general construction. “You can never move out of general construction but as we all know the construction sector is cyclical and can be quite violent with peaks and troughs, and you want to fill those troughs with other sectors.”

Specialist focus 

He believes that the real opportunities lie within the ‘specialist specialists’. This refers to access specific rental companies that themselves concentrate in areas outside of the general construction rental model, perhaps in the van mount or spider lift sectors or platforms of a certain height area, such as over 20m or over 40m.

“You can look at the different product categories. For example, there are a few specialists with the big stuff – truck mounts, and spiders, and in different sectors, like film and TV. I think that is very appealing. “If you buy in one of those specific product groups, you move away from the dependency of construction.”

Nationwide Platforms

A recent notable win in non-construction for Nationwide is a contract to supply powered access to Amazon’s fulfilment sites in the UK, which Rankin describes as a massive multi-million UK pound deal, mainly requiring lower level equipment up to 20m working height. This has led to a similar contract win in Italy, where Loxam PAD will provide the same service across the country.

Providing an insight into company tactics, Rankin adds, “So, we are slowly going through each country on the back of these wins. Next it could be Amazon France, etc, etc. “Loxam is a huge company and we need to use our full capacity, and that is where our real strength comes.” In the UK, Nationwide has also seen considerable success in the aviation sector, a skill set it acquired from Rapid Access, which has provided aircraft maintenance services to airline giant Emirates for the last 20 years.

“We took a lot of know-how from the Middle East and brought that to the UK, along with knowledge of the Oil & Gas sector. When you deal with people in these specialist sectors you really need to be able to speak the language that they speak, or you won’t get far.” Another example of how group-wide cooperation can benefit all parties followed Loxam’s acquisition of Ramirent in 2019.

“Their wind energy penetration is phenomenal, with great relationships and customers. “There is also a great wind market in the UK, and they’re helping us with that. We are also learning about the nuclear sector in France, so that we can target that. But it doesn’t happen overnight.”

Currently, Nationwide’s annual business is made up of 60% construction related projects and 40% non-construction. Ideally the company would like that ratio to shift to 40% construction/60% non-construction. “If you were to ask me what success would look like in three years’ time, I would say it would be that switch in percentage.” He adds, “I think necessity drives change. Right now, construction inflationary costs, the costs of doing business and the competitiveness of the traditional markets, is causing people to think very quickly about making some sort of change.”

Harnessing safety

Harness ON has been one of Nationwide’s key deliveries, having been launched in September 2022 by its accessories division BlueSky Solutions, and now there are plans to expand its secondary guarding innovations. 

When we last spoke, says Rankin, Harness ON was conceptual. “We then brought it into the market and uptake has been quite good. But for me it was too slow.” Up until now Nationwide customers have been charged a weekly premium for Harness ON, with Tier One contractors in the UK gradually mandating it on their sites. Now the company has decided that from the 1 April every Nationwide boom lift will be fitted with the device free of charge. (Find out more about how the ‘seatbelt for MEWPs’ works by stopping the machine if the operator’s harness is not clipped on to the basket). 

Harness On - Nationwide Platforms

“Between the start of the year and May there will be eight or nine Tier One principal contractors that have fully mandated the product.” And, apart from the UK, Rankin said Harness ON is making inroads in the US, Chinese and Australian market.

“By fitting it for free it will speed up the product coming into market.”

Dingli is producing the equipment in China, and while the margins are not great, even in bulk, says Rankin, “We’re just trying to get the product adopted and for people to use it.”

The BlueSky division is never one to stop innovating and as we speak, the company is introducing a new secondary guarding device to its scissor lifts, again designed by Nationwide and manufactured by Dingli. “There’s been a few entrapment issues in the UK coming off the back of scissors and it’s a really important thing that we are bringing to the market.”

As the pioneers of secondary guarding just over ten years ago - or anti-entrapment as it was then called, Nationwide is committed to bringing the offering through to its full potential. “We bought anti-entrapment to the market back in 2012/2013, and we are now doing that with scissors. By the summer if a customer wants anti-entrapment on a scissor, they will be able to order it.”

Rankin sees this level of safety development as a vital part of the business and something that sets it apart from others in the industry. “We need to stay ahead of the competition. They will catch up, but then we have to think about the next thing and the next thing after that.”

One of those next steps will be to develop HarnessOn to allow two people to use it in the basket - currently only one person can use the device in any one basket. “This is something that our customers are asking for and I think there needs to be a lot more technology around that and dog walking and preventing dog walking.” (Dog walking is when a MEWP operator walks alongside a MEWP while moving it using the hand-held control, rather than standing in the platform).

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