15% Lower Rental Fees Compared to General Rental Companies
Direct Equipment Operation and Partnerships with Local Small Rental Companies
[Asia Economy Reporter Ki Ha-young] As the domestic rental market expands, Hyundai Commercial is entering a new market by providing rental services for heavy equipment such as forklifts.
According to industry sources on the 25th, Hyundai Commercial is currently providing forklift rental services for more than 600 units to large logistics companies such as LX Pantos and Dongwon Loex. In April of this year, the service area was expanded to include construction machinery and heavy equipment. As a financial company, it has entered the heavy equipment rental service market alongside large rental companies such as Korea Logispool, AJ, and Doosan Logipia.
In the rapidly growing rental market, industrial machinery and equipment rental is still a blue ocean. According to a report by KT Economic Management Research Institute, the domestic rental market size last year was estimated at 40.1 trillion KRW. Compared to 19.5 trillion KRW in 2011, it has more than doubled in nine years. The detailed market share is as follows: automobile rental 17.6 trillion KRW (44%), industrial machinery and equipment rental 11.8 trillion KRW (29%), and personal and household goods rental 10.7 trillion KRW (27%).
In particular, the rental proportion of industrial machinery and equipment is low compared to advanced countries. For example, United Rentals, the world's number one equipment rental company, rents construction heavy equipment to over 50% of its total customers. This is because it can reduce maintenance costs and depreciation expenses due to the age of the equipment, and there is the advantage of regular equipment inspection and management.
However, in Korea, companies still tend to purchase equipment directly for use. In the case of forklifts, mainly used in manufacturing, distribution, and logistics industries, the rental proportion was about 30% out of a total of 270,000 units operated domestically last year. Moreover, 75% of service providers are local small and medium-sized rental companies.
Therefore, Hyundai Commercial recently started providing heavy equipment rental services targeting the forklift rental market, where corporate demand is increasing domestically. Reflecting the expertise and know-how of the number one financial company in the domestic industrial materials sector, it offers rental fees about 15% lower than general rental companies. While providing customized equipment and services tailored to the conditions of corporate sites, costs have been reduced. In addition, it has secured a professional maintenance system and infrastructure by partnering nationwide with maintenance companies qualified for comprehensive maintenance designated by manufacturers.
A Hyundai Commercial official said, "We operate equipment directly just like large rental companies and also partner with local small and medium rental companies," adding, "Through this, we are building a win-win business model in cooperation with manufacturers, maintenance technicians, and parts suppliers to provide a wider variety of heavy equipment rental services."
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