Equipment rental revenue is expected to increase across North America, according to the American Rental Association (ARA).
The ARA, for the second quarter in a row, is projecting larger increases in revenue almost across the board for equipment rental than it did in the previous five-year forecast released in May.
In Canada, the forecast is for $5.4 billion in revenue in 2018, up 4.4 per cent. IN 2019, equipment rental revenue is expected to climb 4.8 per cent, as well as 4.7 per cent in 2020, 3.8 per cent in 2021 and 2.7 per cent in 2022 to reach $6.159 billion.
The July 2018 forecast from ARA Rentalytics calls for total United States rental revenue of $53.04 billion in 2018, up 7.6 per cent, and then growing 5.8 per cent in 2019, 5.9 per cent in 2020, 5.1 per cent in 2021 and 4.7 per cent in 2022 to reach $65.4 billion.
The May forecast called for total American equipment rental revenue of $52.3 billion in 2018 growing to $64.1 billion in 2022.
“ARA’s second quarter forecast shows continued strong growth in rental revenues over the forecast period,” said John McClelland, Ph.D., the ARA’s vice president of government affairs and chief economist. “Growth rates for 2018 and 2019 look particularly strong in all segments of the equipment and event rental industry with growth rates forecast at more than double the rate of GDP [gross domestic product] growth.”
While the near-term outlook is strong, McClelland said the out-years of the forecast could be subject to change due to the potential impact of tariffs and construction projects.
“Coupled with the increases in equipment prices that are almost inevitable after the imposition of tariffs on steel and aluminum, the equipment and event rental industry could face a challenging economic climate beginning in 2020 and beyond,” McClelland said.
According to ARA Rentalytics, construction and industrial equipment rental continues to account for the bulk of revenue in equipment and event rental and now is expected to reach $37.15 billion in 2018, up 8.3 per cent over last year. General tool rental revenue in 2018 is forecast to be $12.49 billion, up 5.4 per cent.
ARA also forecasts total investment in equipment by rental companies to reach $13.9 billion in 2018, up 7.8 per cent compared to 2017.
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