The term "explode" was actually used in the latest American Rental Association forecast.
"Equipment rental revenue ... is expected to explode past its peak totals in 2022," ARA says.
The group's forecast calls for equipment rental revenue (including ARA's construction/industrial and general tool segments) to reach just under $47.7 billion this year, up 3.1% after declining 9.2% last year. From then, the construction/industrial segment by itself will see a 12% increase, up to 38.5 billion, ARA predicts. That brings the combined total for the two segments up past $53 billion next year.
From 2023 to 2025, the combined equipment rental growth rate is expected to be consistent at between 2% to 5%, ARA says, and reach $57.5 billion in 2025.
“The equipment rental segment is moving like the rest of the macro economy from relief to recovery," says John McClelland, ARA vice president for government affairs and chief economist. "We are seeing a good uptick in business activity that is going to bring rental revenues back to pre-pandemic levels in 2022."
McClelland says the biggest concern is nonresidential construction's slump. "However, a robust infrastructure bill from Congress would provide a significant long-term boost to that sector as well,” McClelland says.
ARA says its Q1 2021 report is the first quarter it segmented its forecast to include just the construction/industrial and general tool segments. ARA's event rental segment will see new reporting later this year.
Just looking at the general tool segment, ARA expects growth of 5% in 2021 to $13.2 billion, growing 4% in 2022 and 3% during the next three years to surpass $15 billion in segment revenue in 2025.
