In its latest quarterly economic forecast, the American Rental Association (ARA) is predicting an increase in rental revenue growth for Canada and the United States.
In Canada, growth is expected to slightly outpace previous forecasts. Canada’s combined construction and industrial equipment (CIE) and general tool rental industry is forecast to grow 5.2 per cent in 2026, totalling $6.3 billion.
Like the U.S. forecast for this segment, this is essentially unchanged from the previous quarter’s projection for the year.
Beyond 2026, growth in combined Canadian CIE and general tool rental revenue is projected to reach 5.4 per cent in 2027 and 5.5 per cent in 2028.
The ARA attributes the growth in Canadian rental equipment revenue to increases in infrastructure spending and oilfield development.
US forecast
In the United States, CIE and general tool rental industry is projected to increase by 3.4 per cent in 2026, totaling $83.5 billion — essentially unchanged from last quarter’s projection for the year.
Beyond 2026, growth in combined United States CIE and general tool rental revenue is projected to grow at a pace of 4.4 per cent in 2027 and 5.1 per cent in 2028, slightly higher than the projections indicated in the previous quarter for these years.
“The latest ARA Rentalytics updates confirm the equipment rental structural changes toward rentals,” said Tom Doyle, ARA Vice President of Program Development.
“The rental revenue increase indicates the preference for renting over ownership. The reasons are many for the growth, including the access to the equipment versus the asset ownership and the economics of renting. While rental revenue has increased, the results are mixed. If you have any of the large infrastructure projects or data center buildouts, you’re in a stronger market with generally better results.”
Scott Hazelton, Managing Director at S&P Global, the international forecasting firm that compiles data and analysis for the ARA forecast, said that while United States growth has remained resilient, certain headwinds exist that could impact the forecast.
“One of the risks to the forecast is what is happening in the Middle East. The war [with Iran] is not the problem for the U.S; the problem is the transmission of inflation through energy rates — both because of lower supply and because of the risk of transporting through the Strait of Hormuz,” Hazelton said, adding the larger concern for the American economy is the cost of the energy and its impact on inflation.
“If inflation stays elevated through this year, that limits what the federal reserve can do with interest rates, and in fact we’ve seen housing starts fail to move and most recently the numbers we saw for construction spend and home improvement spending was down too.”
At the same time, Hazelton said the risk to the forecast of inflation through oil prices as well as through tariffs “are relatively, right now, lower-risk outcomes. It’s unlikely we’ll see a major change in the Middle East to higher prices. In fact, we think, if anything, they’ll get lower as tensions cool somewhat. And the tariff picture — the Supreme Court has already ruled on what [the government] can and can’t do.”
Event rental segment
Also in its updated forecast, ARA shared the United States event rental industry is forecast to grow 9.5 per cent in 2026 to total $6.2 billion — an increase from last quarter’s projection of 8 per cent growth to total $6.1 billion this year.
Beyond 2026, American event rental revenue is projected to grow 8.3 per cent and 6.4 per cent in 2027 and 2028 respectively.
The Canadian event rental industry is expected to grow 6.1 per cent in 2026, totaling $280 million.
Beyond 2026, growth in Canadian event rental revenue is projected at 7.4 per cent and 5.6 per cent in 2027 and 2028 respectively.
“Event rental revenue accelerated in the U.S. and Canada, showing a solid increase over 2025. Those increases are forecast to continue in 2027,” Doyle said.
