This month, associate editor Lisa Schroeder talks to drill drig suppliers about the used market.
Much like buying a used car, purchasing a used rig is a viable option for many these days, especially for the driller just starting out or for those who are expanding their business offerings and need an extra rig. With this in mind, we asked some used rig vendors to share their thoughts on the used market and about the trends they see. Interestingly, we found that the economy and affordability still weigh heavily on people’s minds, affecting the used rig business, and technology, we learned, holds an important place in the used market.
When it comes to buying equipment, whether new or used, pricing factors heavily into the equation. Craig Nelson of Nelson Group, Enid, Okla., offers his observations on customers’ tendencies in purchasing equipment, “The trend is, if they absolutely have to buy, and they can afford to buy, they’re buying new instead of used. And if they have a used rig, they’re spending their resources to update it or buy parts and keep it going, like we do with our cars.” The first quarter of this year, perhaps even the latter part of last year, he has noticed people postponing purchase or buying only out of need. Nelson asserts, “I think not only drilling contractors, but all types of contractors in the construction business are somewhat delaying capital expenditures, or they’re not buying unless they absolutely have to. So they’re putting things per se on the back burner or delaying the purchase of capital equipment — a major expense.”