Revenue in the equipment rental industry is expected to grow 7.1% in 2024, according to the American Rental Association. In its current forecast, revenue is expected to grow 11.3% in 2023 compared to 2022, totaling $71.5 billion in construction and general tool rental.
Both forecasts are up compared to the expectations of the previous quarterly forecast, according to ARA. Last quarter, the year-over-year growth was expected to be 7.6% in 2023 and 3.1% in 2024.
“We are more bullish this quarter than last quarter,” says Scott Hazelton, managing director at S&P Global, in a statement. “We are seeing a decent uptick with inflation moderating and our projections are relatively similar — stagnant but strong.
“It’s important to note that there will be more growth in construction and industrial equipment (CIE) than in general tool,” he said.
Earlier in the year, the forecast predicted a recession that did not materialize. Although the first two quarters of the year proved slow, third quarter revenues are very strong, and the Q4 projections appear that way as well, according to the group.
Canadian equipment rental revenue growth is higher in 2023 compared to last quarter’s projections due to inflation and resilient demand. The CIE outlook in Canada is slower growth with strong levels of activity in 2024, that is a 3.7% revenue increase, making it a $4.5 billion industry with stronger growth anticipated in outbound years, a 7.2% revenue increase in 2025 and 5.7% in 2026.
ARA’s quarterly member survey showed conflicting results among members with regard to revenue increase: Half of respondents expect to see a revenue increase in Q4, and half expect a decrease. There was also an increase in members who believe the situation for business is more stagnant.