Current economic indicators, while mixed and uncertain, point toward significant growth for equipment rental revenue in the U.S., according to the latest quarterly update of the five-year forecast released by the American Rental Association (ARA).
"The longer-term forecast, while showing slower growth than this year, remains bullish. It is generally a good time to be in the equipment rental industry," said Tom Doyle, ARA vice president for program development. "In these times of higher uncertainty, it is prudent to closely watch the driving factors to the forecast for changes that will affect build schedules for original equipment manufacturers (OEMs) or demand for rental companies. Depending on how long we have high inflation, supply chain constraints, labor shortages and climbing interest rates, those econometric drivers can have an impact on the rest of 2022 and the outlook for 2023."
The update, released Aug. 3, included the following projections:
- Equipment rental revenue will grow 11.2 percent to nearly reach $55.9 billion in 2022. ARA expects growth of 6.2 percent in 2023, 2.5 percent in 2024, 3.3 percent in 2025 and 3.7 percent in 2026 to total more than $65.1 billion.
- For construction equipment rental revenue, the forecast calls for a 12.5 percent increase in 2022 to surpass $41.6 billion, with growth slowing to 7 percent in 2023, 2 percent in 2024, 3 percent in 2025 and 3 percent in 2026.
- General tool growth is expected to be 7.4 percent in 2022 and then remain fairly steady with 5 percent growth in 2023, 3 percent in 2024, 5 percent in 2025 and 5 percent in 2026.
- The ARA forecast for equipment rental revenue in Canada, combining construction and general tool revenue, closely mirrors the outlook for the U.S., projecting growth of 14.4 percent in 2022 to $4.7 billion, 6 percent in 2023, 2 percent in 2024, 3.4 percent in 2025 and 3.3 percent in 2026 to exceed $5.4 billion.
