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Used equipment prices remain stable in Middle East

by CW Guest Columnist on Feb 12, 2018


Euro Auctions site in Dubai
Euro Auctions site in Dubai
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Demand for both new and used construction and agricultural equipment across the Middle East is generally seen as improving, following the global economic downturn in the late 2000s.

However, what has been noticeable in recent months is a significant shift in the commercial buying processes with large equipment users becoming more financially aware of the ownership, operational cost and disposal values of their inventory. 

The global reduction in oil prices has definitely had a knock on impact on some construction contracts with a few high profile projects having been postponed in recent months.  

However, construction is evident on almost every corner in Dubai and there is still significant activity underway right across the whole region.

It is evident that buyers are streaming back to the market and in general, used equipment prices in the Middle East have remained relatively stable over the past year.

And in some instances, because prices are actually lower than those commanded in parts of Europe and the Far East, we are seeing an influx of new buyers looking to acquire equipment for export into these regions to meet requirements.

The models sold in the region also tend to be focused more towards functionality rather than incorporating additional gadgets, making it easier to maintain them.

In the past, new equipment was typically purchased for a project and then disposed of upon completion.

This approach has shifted somewhat as many of the big local construction operations and the leasing companies that support them seek to extract more value out of the project.

In some instances nearly new, well maintained equipment in all shapes and guises will return to the market within a couple of years of purchase as they command premium prices and are in much demand. 

Some construction operations are also opting to hold onto key items of equipment for between four and eight years, choosing instead to invest in comprehensive maintenance but benefit from the lower rates of deprecation on older plants.

When these lots come onto the market they are also still in high demand because despite their age, they have full service histories and still have a number of productive years ahead of them.

Prospective buyers here tend to be Tier-2 operations, looking for quality equipment to take on smaller building schemes and ongoing maintenance contracts.



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