September 2017 Vol. 72 No. 9
Newsline
Equipment Rental Industry Forecast Remains Steady
The latest (July) quarterly update to the five-year forecast for equipment rental industry revenues released by the American Rental Association (ARA) continues to call for steady gains.
With only minor variations from the previous quarter, the new U.S. forecast projects growth to be $49.3 billion in 2017 (up 4.3 percent over last year), 5 percent in 2018, 5.8 percent in 2019, 4.4 percent in 2020 and 3.9 percent in 2021, reaching $59.4 billion combined for the three segments of the industry, including construction/industrial, general tool/light construction and party/special event.
The quarterly update also reflects relatively steady projections for real gross domestic product (GDP) growth over the next few years in the U.S. of 2.3 percent in 2017, 2.7 percent in 2018 and 2.3 percent in 2019.
“What is interesting to note is that the U.S. equipment rental industry continues to post strong performance numbers that nearly double the growth of economy and we expect this trend to continue for the foreseeable future,” said John McClelland, ARA’s vice president for government affairs and chief economist. “How Congress deals with tax reform and infrastructure spending also could add to the equipment rental industry’s momentum.”
Scott Hazelton, managing director, IHS Markit, independent research firm, agreed that data on the broad economy continues to be positive, resulting in very little change in the equipment rental revenue outlook.
“However, there is considerably greater uncertainty regarding the outlook for 2018,” he said. “We still expect tax reform and an infrastructure spending increase that will accelerate the economy next year. Such stimulus would push rental revenue growth toward 5 percent. Yet the lack of legislative consensus, even within the majority party in Washington, D.C., does give reason for concern that expected stimulus might not be forthcoming.”
In Canada, the latest five-year forecast continues to call for accelerating revenue growth each year, starting with a 2.7 percent increase in 2017 to reach $5.12 billion. Total rental revenue in Canada is expected to grow another 3.2 percent in 2018, 4.7 percent in 2019, 5.1 percent in 2020 and 5.6 percent in 2021 to reach $6.14 billion.
FOR MORE INFORMATION
American Rental Association, (800) 334-2177, ararental.org
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