Compressors are crucial to many jobsites and the market for this is always evolving. One of the main factors that contributes to the ever-changing market is in regards to regulations from the Environmental Protection Agency (EPA). In an effort to maintain high profitability in the face of new emissions regulations, many rental stores are rebuilding the engines of non-compliant equipment to continue to extend the life of their fleet.
This rebuilding trend buys rental stores more time before they need to purchase the new, more expensive compressors with EPA compliant engines. Rebuilding compressors reduces the cost and allows the rental stores to maintain the existing rental rates, giving them an advantage in their local rental market over competitors with new compressors.
Rental Customers and Rental Stores
Rental customers are always looking for ways to keep their rental rates down. They want reliable products to perform the work they need efficiently.
On the other hand, rental stores with the new higher priced equipment struggle to keep utilization of the compressors high enough to pay for the compressor and also maintain a reasonable ROI. Rental stores face challenges when trying to find a balance between the higher rental rates and lower demand in the rental market of T4F compressors.
Challenges and Solutions
The main challenge for rental stores that are considering the purchase of T4F compressors is to account for the added cost of the new T4F diesel compressors and still maintain competitive rental rates.
On the other side of the counter, customers are exploring their options like the smaller single tool compressors (90 to 110 CFM). The majority of compressor rentals only go out with one air tool, so the standard 185 CFM compressors have more CFM than is actually needed.
This opens the door for the new single tool compressors like the CPS 90 and the future 110 CFM compressors to find a spot in the marketplace. These units are priced lower, which leads to lower rental rates, but still allows rental stores to maintain positive ROI.
The smaller diesel engines cost less because they only need a Diesel Oxidation Catalyst (DOC) to meet the T4F requirements. These new smaller T4F compressors are attractively priced and they don’t have the diesel particulate filter (DPF) systems with regeneration cycles that require the diesel engine fluid (DEF) allowing the customer to avoid the potential technology issues.
The prospect of Tier 5 emissions regulations would require manufacturers to add a diesel particulate filter to all of their engines. The system would reduce particulate volume, not just the mass or the size. DPFs have proven to be troublesome in some applications, resulting in equipment that did not always perform as needed.
Although Tier 5 emissions regulations are still in the distant future, rental stores and manufacturers alike will be preparing appropriately. In the meantime, the trend of rental stores rebuilding compressors looks to continue into the foreseeable future.