Total equipment rental revenue is expected to reach $38 billion in North America for 2013, according to the latest figures released by the American Rental Association (ARA) from its ARA Rental Market Monitor. This figure represents a 6.2 percent increase over 2012, with fourth quarter revenue growth projected to be 7.1 percent.
The figure includes revenue for all three segments of the equipment rental industry—construction/industrial, general tool/DIY and party/special event—in both the U.S. and Canada combined.
In the U.S. alone, equipment rental revenue is projected to grow 6.5 percent in 2013 to reach $33.3 billion.
“The general economy in the U.S. has slowed down slightly this year with the gross domestic product (GDP) now forecast to grow 1.5 percent in 2013. That means equipment rental industry revenue continues to grow at more than four times the general economy,” said Christine Wehrman, ARA’s executive vice president and CEO.
The ARA Rental Market Monitor North American Economic Analysis provided by IHS Global Insight projects revenue growth to accelerate in all segments through 2015 before leveling off in 2016 and 2017. The general tool segment will show the highest compound annual growth rate (CAGR) at 10.1 percent over the five-year forecast while construction and industrial equipment revenue is forecast to see a CAGR of 7.8 percent between 2013 and 2017.
In the U.S., the construction market and consumer spending are expected to be the most important drivers of growth of the equipment rental market in 2014, continuing its upward trajectory and showing strong growth through 2017. Strong growth in residential and commercial construction through 2015 is expected to fuel the construction and industrial equipment segment, which is projected to grow 9.1 percent in 2014 and 10.5 percent in 2015.
The U.S. general tool segment is expected to grow 7.9 percent in 2014 and 15.5 percent in 2015. The ARA Rental Market Monitor also forecasts party and event rentals to benefit from continued improvement in consumer spending with rental revenue projected to show a 3.2 percent CAGR over the five-year forecast to 2017.
Overall in the U.S., total equipment rental revenue is expected to grow at a CAGR of 8.6 percent between 2013 and 2017, exceeding pre-recession totals in 2015 and reaching $46.3 billion in 2017.
Investment in equipment by equipment rental companies also is expected to grow in 2014, but jump in 2015 to surpass $14 billion.