Equipment Rental May Hit $33.8 Billion: ARA
Total equipment rental revenue in North America for 2013 is expected to reach $38 billion, according to the latest figures released by the American Rental Association (ARA). According to information from its ARA Rental Market Monitor service updated in late October, the figure represents a 6.2% increase over 2012 with fourth quarter revenue growth projected to be 7.1%.
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, ARA said.
“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% in 2013,” said Christine Wehrman, ARA’s executive vice president and CEO. “That means equipment rental industry revenue continues to grow at more than four times the general economy.
“The industry remains vibrant, strong and will benefit even more in the coming years due to nonresidential growth, supplemented with residential construction growth and the strong influence of the energy boom in North America. We expect revenue in the U.S. to grow 8.4% in 2014 and 11.3% in 2015.”
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. According to the U.S. economic analysis from the ARA Rental Market Monitor and IHS Global Insight, the U.S. equipment rental market is expected to continue its upward trajectory and show 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% in 2014 and 10.5% in 2015.
Overall in the U.S., total equipment rental revenue is expected to grow at a CAGR of 8.6% 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, ARA said.