ARA forecasts strong rental growth for 2022

The latest quarterly American Rental Association (ARA) forecast for equipment rental revenue calls for a 10.2% increase in 2022 and revenue of $52.7 billion in the United States.

The revenue forecast also calls for equipment rental, which includes construction, industrial and general tool revenue, to increase by 6% in 2023, 2.9% in 2024, and 3.4% in 2025 to reach $59.5 billion.

Scott Hazelton, director, economics and country risk at IHS Markit in Andover, Mass., the company that provides data and analysis for the ARA Rentalytics forecasting service, said the continued strong forecast for growth corresponds with the optimism within the industry.

“This is a market that will surpass the peak revenue levels of 2019,” Hazelton said. “That means the impact of the coronavirus (COVID-19) on equipment rental revenue will be unwound by the end of the year,” Hazelton said.

Construction and industrial equipment rental revenue is expected to lead the way with a 12% increase in 2022 to $38.9 billion while the general tool segment is expected to grow by 5% to reach $13.9 billion this year.

Rising inflation could have an impact on the forecast, however, the ARA said.

While supply chain issues have caused delays in delivery of fleet to equipment rental companies, the ARA forecast projects a 36.7% increase in investment in inventory to reach $14.4 billion in 2022, exceeding the previous annual high of nearly $13.8 billion spent in 2019.

The forecast calls for another investment increase of 10.1% in 2023 to reach nearly $15.9 billion.