| 24 Jul 2010 |
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UAE: Generator sales and renting soar
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DUBAI/SHARJAH -- There is a shortage of generators in the local market following the power outage in Sharjah, with people hiring the much-needed power generator from neighbouring Dubai and as far as Abu Dhabi, industry sources say.
A sales manager from Sharjah International Airport Free Zone-based company said a lot of people were enquiring about renting generators as there are no stocks for small- and medium-sized ones in the market.
"We are not in the renting business, we sell generators and we did not notice any change in our business due to power shortage in Sharjah, but companies involved in the hiring business are benefiting a lot," he said.
"People don't buy generators because they think this (the power shortage) is temporary and hope to use rented generators for maximum of two to three months. Big companies are buying new products, while smaller companies usually go for rentals," a source from Al Binayah Building Materials Trading in Sharjah, said.
"Of course, in the long-term perspective, it is cost efficient to buy a new generator," he said, adding that the company has recorded a slight rise in sales after the crisis broke.
A salesman from Sharjah-based Champions, which deals in generator renting, said at the moment, the company had only medium and big size generators from 40 KVA onwards for hiring.
"We have run out of small generators and have only medium and big sizes. A 40 KVA generator will cost you Dh4,500 per month as rent and Dh47,000 if buying a new one," he said.
Sami Jaber from Casablanca Generators in Sharjah said sales increased by 10 per cent compared to two months ago since the power shortage outbreak in the emirate. "Units from 30 KVA to 200 KVA of capacity are in big demand," he said.
A source from Al Qudrah Used Building Machines and Equipment said sales have significantly increased in the last three days. "Our business is at least 50 per cent up now. People are hiring all kinds of units -- from 20 KVA up to 600 KVA. With a 20 KVA generator, you can power a small office or residential air-conditioner, while a 650 KVA unit can provide power to a 10-storey building.
''In fact, our suppliers are so happy with us because of the brisk business. We hardly have time to place new orders. People are not even asking for prices, let alone bargain, and they are ready to pay in advance. At the moment, we do not have small generators, all are rented out," he said, adding that the boom is expected to last till September end.
"We have shortage in rentals and our stock is finished. At the moment, we have only one generator left. People are ready to pay double the price and we have a long waiting list," he said.
"People normally prefer to hire used generators rather than buy new ones because the latter involves a lot of maintenance work," he added.
Some, however, said that the current boom could lead to a price hike in the rental and sales market alike. Currently, prices are 10 to 15 per cent less than they used to be back in 2006.
"Our suppliers are already hiking prices because of the demand. Many people are confused now and they are considering in investing in new generators. If the situation persists, prices will shoot up," a Dubai-based sales manager said.
Ashras Allam, general manager of the Abu Dhabi-based Al Masaood (Power Engineering Division), said his company had been getting a lot of enquiries from Sharjah for the last three days.
"Though they ask for quotations only to buy new generators, there is a possibility that sales will go up because we know that it is very difficult at the moment to hire a second-hand generator as stocks are running out even in Abu Dhabi," he said.
B Jamila Qadir
© Khaleej Times 2010
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