The equipment rental industry in the United States is expected to generate $35.8 billion in revenue and outpace gross domestic product (GDP) by more than four times in 2014, according to the American Rental Association’s latest forecast from the ARA Rental Market Monitor. Economic data and analysis for the ARA Rental Market Monitor are compiled by IHS Global Insight.
In the U.S., total equipment rental revenue is forecast to grow 7.6% in 2014 to reach $35.8 billion, 10.5% in 2015 to reach $39.6 billion and another 10.2% in 2016 to reach $43.6 billion, surpassing the previous industry record of $36.9 billion in 2007. The growth rate is expected to be 8.9% in 2017 and 7.7% in 2018, with total rental revenue of $51.2 billion.
“The U.S. economy slowed more than expected in the first half of the year, but equipment rental demand has remained strong and rental growth will still handily outperform the overall economy,” says Scott Hazelton, managing director with IHS Global Insight. “Looking forward, commercial construction and housing starts will contribute to growth in the construction and industrial and general tool segments.”
Over the next two years, the construction and industrial segment and the general tool segment are expected to experience double-digit growth in U.S. rental revenue. In 2015, construction and industrial rental revenue is projected to increase 10.7% and general tool 11.7% and again in 2016 with increases of 10.4% and 11.6% respectively.
The party and event segment is expected to continue it same steady growth, with revenue increasing 4.2% in the U.S. in 2014 to reach $2.6 billion.
The forecast for Canada calls for 5.2% growth in 2014 to $4.9 billion, with growth of 6.0% in 2015, 6.6% in 2016, 3.5% in 2017 and 3.6% in 2018 to total $5.9 billion at the end of the latest forecast.
It also is expected that rental companies in the U.S. will continue to invest more than 30% of their revenue in new equipment over the next five years. Total investment, according to the ARA Rental Market Monitor, is projected to reach $12.1 billion in 2014 and grow to $16.1 billion by 2018.