By Johathan Kozlowski – American Rental Association – For Construction Pros.com
The quarter two rental industry forecast from the American Rental Association sees a slight increase for 2024.
- Q1 forecast: 7.9 increase
- Q2 forecast: 9.7% increase, though growth may slow in 2025 and again in 2026
- Revenue from general tool expected to see a 9.7% increase as well
According to the American Rental Association (ARA) latest forecast, the projection for the equipment rental industry has increased since last quarter. The Q1 forecast originally projected a 7.9% increase, the most current projection indicates a 9.7% increase in 2024, totaling a $79.2 billion in construction and general tool rental revenue.
Conducted through the lens of the ARA’s exclusive rental revenue model and survey results from members, “the forecast confirms the continuation of a growing rental industry,” says Tom Doyle, ARA vice president program development.
However, Scott Hazelton, managing director at S&P Global seems pragmatic about the projections. He notes that the forecast is neither a serious bust or boom. “The outlook remains steady and inflation is falling. The growth rates tail off in the future years, with growth of 3.8% in 2025 and 3.1% in 2026.”
Congress suspended the debt ceiling through 2024. The Federal Reserve will not be cutting rates until December. Rate cuts being deferred to December does not affect 2024, but weakens 2025’s growth.
Jeff Vance, senior vice president of operations services, Sunstate Equipment Co., adds, “Our forecasts are in line with S&P’s as well. We did see a softer winter and spring than we typically see, with used equipment prices softening substantially as well but we are seeing single digit growth in 2024.”