ARA issues new revenue forecast
The American Rental Association (ARA) has issued an updated forecast.
The latest forecast calls for a 7.9% increase in 2024, with construction and general tool rental revenue reaching $77.3 billion.
Previously, the ARA had forecast 3.1% growth for the year.
“The ARA Rentalytics quarterly forecast reinforces the strength of the rental industry,” says Tom Doyle, ARA vice president, program development. “Rental should benefit with tailwinds from interest rates, inflation, improving supply, a preference to rent, and government and private spending. Rental revenue is again forecasted to increase.”
Looking at construction and industrial equipment (CIE) growth in the United States, projected revenue is expected to rise by 7.5% to $60.9 billion in 2024.
Revenue of growth of 3% is expected is forecast for 2025, 2026, and 2027.
“We see a slowing of growth this year compared to last year but bear in mind, we have a slowing of inflation this year as well,” says Scott Hazelton, managing director at S&P Global. “The growth rates tail off in the future years, with growth of 4.3% in 2025 and 3.9% in 2026.”
The current forecast for total Canadian equipment rental revenue shows a 3.1% growth to $974 million in 2024.
While CIE investment will decline from previous years, a 7.2% increase is forecasted. The contrast from previous years is attributed to the lack of post-COVID investments in 2024, the ARA said.
General tool investment in the United States is not quite as positive of an outlook. There is muted investment growth at 6.8%. According to the ARA, manufacturing is driving the growth and housing is still the weak spot.
"ARA’s quarterly member survey showed conflicting results amongst members with just over half of respondents saying they saw a revenue increase in quarter four, a slight improvement over quarter three which saw an even split between those an increase and decrease," says Mike Savely, ARA director, program development.
Based in Moline, Illinois, the ARA includes more than 11,500 rental businesses and more than 1,000 manufacturers and suppliers.
