U.S. total equipment rental revenue will grow 7.6 percent this year, reaching $35.8 billion, but the American Rental Association is even more bullish about rental in the coming four years.
ARA says rental revenue will grow 10.5 percent in 2015, reaching $39.6 billion; another 10.2 percent in 2016, reaching $43.6 billion; 8.9 percent in 2017 and 7.7 percent in 2018 for a total of $51.2 billion.
If the forecast holds true, in 2016, the rental industry will surpass the previous industry record of $36.9 billion in 2007.
Despite an overall U.S. economy that slowed more than expected the first half of the year, “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, which compiles the ARA forecast. “Commercial construction and housing starts will contribute to growth in the construction and industrial and general tool segments.”
In 2015, the construction and industrial segment rental revenue is expected to increase 10.7 percent in 2015 and 10.4 percent in 2016. The general tool segment will increase 11.7 percent in 2015 and 11.6 percent in 2016. Canadian rentals will see a 5.2 percent growth in 2014 to $4.9 billion, and a 6 percent growth next year.
ARA expects U.S. rental companies will continue to invest more than 30 percent of their revenues in new equipment over the next five years. Total investment will reach $12.1 billion in 2014 and grow to $16.1 billion by 2018.