Five Years of Steady Growth Forecast for Equipment Rental Industry
Though slightly more moderate than the past two years, the American Rental Association's latest forecast projects 6.7% growth in 2016 and 2017, 6.2% in 2018 and 5.8% in 2019. The industry shows steady growth, regardless of changes in oil and gas, construction and other segments equipment rental companies serve.
“The performance of the equipment rental industry since the recession has been very positive and as auxiliary industries recover and grow, we anticipate equipment rental revenue growth to meet the forecast of the next five years,” says Christine Wehrman, ARA CEO and executive vice president.
“This means equipment rental companies can prepare for steady growth, plan for expanding their markets and build inventory to meet their customer demand. The forecast also shows that many customers who have turned to renting equipment during and after the recession have seen the benefits and will continue to rent to control their costs,” Wehrman says. “The secular shift to rental is here to stay.”
The economic analysis from the ARA Rental Market Monitor subscription service suggests that the ongoing rebound in real residential construction in 2015 will help fuel the growth in the construction and industrial equipment and the general tool rental segments.
“A 2015-19 compound annual growth rate (CAGR) of 2.7 percent is projected for real total construction with real nonresidential growing 1.0 percent and real residential growing 5.7 percent. This will drive revenue growth in the construction and industrial segment and the general tool segment, which will average annual revenue increases of 6.5 percent and 6.7 percent respectively, over the period,” according to the latest analysis provided by IHS Economics, the forecasting firm that provides data and analyses for the ARA Rental Market Monitor. Total equipment rental revenue is expected to grow at a CAGR of 6.3 percent between 2015 and 2019, reaching $48.7 billion in 2019.”
The short-term forecast for Canada is more subdued in 2016, with expectations of 0.8 percent growth in equipment rental revenue to reach $4.98 billion, with a greater rebound of 5.7 percent in 2017, 6.3 percent in 2018 and 5.6 percent in 2019 to reach $5.9 billion.
PRO CONTRACTOR RENTALS MAGAZINE
Pro Contractor Rentals provides information of value to rental centers who focus time, resources and attention on meeting the demands of construction contractors and other equipment rental customers.
