The American Rental Association (ARA) expects equipment rental industry revenue to consistently grow with a compound annual growth rate (CAGR) between 2017 and 2021 of 4.7 percent in the United States, according to its latest five-year forecast. This, ARA reports, would result in total revenue of $59.3 billion in 2021.
Updated in early November, the ARA Rental Market Monitor five-year forecast reported that total rental revenue in the United States is expected to grow by 4.5 percent in 2018 to reach $51.5 billion, 5.5 percent in 2019, 4.9 percent in 2020 and 4.1 percent in 2021.
The report says that the forecast for November is almost the same as the last forecast in August, with only a few minor fluctuations in expected growth rates each year.
The report also shows that equipment rental revenue in Canada is expected to show consistent growth, reaching $5.3 billion in 2018 with growth rates of 4.1 percent in 2019, five percent in 2020 and 4.8 percent in 2021 to total $6.11 billion.
“This is a strong forecast, showing the equipment rental industry will continue to consistently grow over the next five years, without factoring in any possible impact from tax reform or infrastructure spending,” says John McClelland, ARA’s vice president for government affairs and chief economist. “People continue to realize the benefits of renting and how it can positively impact the bottom line. As a result, the equipment rental industry continues to outperform the general economy as well as the industries it serves.”
The ARA Rental Market Monitor features data and analysis from IHS Markit, a forecasting firm. According to their information, construction/industrial equipment rental revenue is expected to show a 4.1 percent CAGR over 2017-21, reaching $40.4 billion in 2021.
The report shows that general tool is expected to post a 5.7 percent CAGR over the forecast period, reaching $15 billion in 2021. The report also shows that party and event is expected to have a 6.3 percent CAGR and surpass $3.9 billion in revenue in 2021.
The report shows that investment in rental equipment is projected to increase by four percent in 2018, 8.4 percent in 2019, 2.6 percent in 2020 and 1.2 percent in 2021, surpassing $15 billion that year.