With supply-chain challenges continuing to impact manufacturers’ abilities to produce heavy equipment, the equipment rental market continues to see growth.
The American Rental Association’s recently released update of its five-year forecast continues to point toward continued growth for equipment rental revenue in the U.S. in 2022 and beyond.
For 2022, ARA’ projects U.S. equipment rental revenue, including construction and general tool, to grow 11.2% to reach $55.9 billion, consistent with earlier projections this year. Construction equipment rental is expected to lead the way with 12.5% growth this year to a total $41.6 billion, following a 10.2% increase in 2021.
“Rental revenue continues to experience significant growth, despite some headwinds in 2022,” said Tom Doyle, ARA vice president for program development. “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.”
In the next five years, ARA expects overall growth of 6.2% in 2023, 2.5% in 2024, 3.3% in 2025 and 3.7% in 2026 – to total more than $65.1 billion. For construction equipment, the forecast calls for growth to slow to 7% in 2023, 2% in 2024, 3% in 2025 and 3% in 2026. In addition, general tool growth is expected to be 7.4% in 2022 and then remain steady with 5% growth in 2023, 3% in 2024, 5% in 2025 and 5% in 2026.
“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 or demand for rental companies,” Doyle said. “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.”