Construction auction activity has been on the rise, and equipment purchasers may be losing optimism, according to the latest EquipmentWatch Market Report.
The report leverages key equipment values, market activity, age and usage metrics to act as a monthly resource for the construction industry.
"While confidence has somewhat flagged, used equipment values remain high in both the resale and auction segments," Brian Dewey, head of strategic accounts at EquipmentWatch, told WOC360. "The lower level of resale activity shows that contractors are holding on to their equipment as the construction segment continues to rebound thanks to a greater number of available projects fueled by the release of Bipartisan Infrastructure Law funds."
It studies the latest numbers available to help industry professionals make better-informed decisions.
"Sustained price increases and supply chain woes are causing construction equipment buyers to lose the optimism they had earlier in the year," the July 2022 EquipmentWatch Market Report report stated. "According to Construction Equipment’s mid-year survey of equipment managers, seven out of 10 respondents reported that they’re lowering confidence due to supply chain issues."
Previously, EquipmentWatch Strategic Account Manager Nick Holsinger told WOC360.com that he doesn't foresee any improvements in the supply chain issues anytime soon.
“Inflation, labor shortages, key scarcities such as semiconductors, and ever-increasing fuel costs have deep-seated causes that will not improve in the immediate future,” Holsinger said. “We need to look for demand destruction in fuel, an ease in the COVID-19 pandemic, and hopefully peace in Ukraine to anticipate long-term relief in the supply chain.”
At the beginning of the year, Construction Equipment's survey reported that 32.7% of respondents expected to expand their fleets. That number fell to 26.9% in Construction Equipment's mid-year survey.
"That lack of confidence may have contributed to already low activity levels," the report stated. "Activity was 30.3% below May 2021 and 45.6% below May 2020."