Hitachi Construction Machinery (HCM) has purchased a 33.3 per cent equity interest in Acme Lift Company in order to enter the North American rental market.
The joint venture will add Hitachi earthmoving equipment to Acme’s fleet, which will be available through Acme’s proprietary re-rental operations to equipment rental companies across North America.
“ACME brings to the venture unique expertise in re-rental of various equipment product classes. Joining forces with Acme furthers HCM’s strategy to strengthen its value chain business,” said Yasushi Ochiai, executive vice president in charge of international business for Hitachi Construction machinery.
With Hitachi’s investment, Acme has reduced its debt service costs as well as generated substantial liquidity to fund its future fleet growth and expansion plans.
“ACME’s rental customer base has been increasingly requesting both wheel loaders and excavators on a re-rental basis,” said Woody Weld, Acme chairman and chief executive officer.
“This new partnership with Hitachi Construction Machinery will allow every retail construction equipment rental company in the North American marketplace to have access to a full range of well-proven and highly regarded Hitachi earthmoving products.”
Entering the North American rental market is part of Hitachi’s Connect Together 2019 mid-term management plan.
Through its investment in Acme, Hitachi aims to grow its rental business in North America, which is home to the world’s largest rental market. As well, the investment aims to acquire business expertise that can be leveraged to expand the business into other regions in the future.
Specifically, Hitachi will support Acme in finance and through the utilization of its existing North American distribution channels. Furthermore, Hitachi plans to expand Acme’s earthmoving equipment re-rental business and provide overall business support. The details of these operations will be developed and implemented in the future.
Acme’s main focus is renting aerial work platforms and compressors to equipment rental companies, which they can then rent to their customers. With the aim of expanding its re-rental business model to earthmoving machinery, Acme was already searching for an ideal business partner. Recently, Acme recognized the mutual interests shared with Hitachi, leading to the decision to select the company as a business partner.
In the future, Hitachi plans to expand its value chain business by implementing a global expansion of the rental business beyond North America.