Issue link: http://psai.uberflip.com/i/1189904
WEEKLY EDITION DECEMBER 4, 2019 PAGE 18 Equi pment and Event Renta l Revenue For ecast to Outp ac e Economi c Gr owth From the American Rental Association…continued from page 15 "Despite signs of a slowing economy, the equipment and event rental industry continues to perform well. The most important thing for rental companies to do is continue to execute their business plans and aggressively manage their operations," says John McClelland, Ph.D., ARA vice president for government affairs and chief economist. "With chances of a recession in the next 12 months relatively low at 35 percent, rental businesses should be able to continue to grow revenues and maintain strong balance sheets," McClelland says. Scott Hazelton, managing director, IHS Markit, says the next 12 to 18 months will feature significant uncertainty around trade and fiscal policy, compounded by the U.S. elections. "Rental firms are well positioned for uncertain times. The reluctance of construction and industrial companies to invest in new equipment under these circumstances, combined with a still expanding economy, suggests that the opportunities for equipment rental will continue to grow, albeit at a slower pace than the past few years," Hazelton says. According to ARA, construction equipment rental in the U.S. is forecast to grow 5.2 percent in 2019, with growth rates of 2.3 percent in 2020, 3.0 percent in 2021, 3.7 percent in 2022 and 3.1 percent in 2023 to reach $43.9 billion. The growth rates for general tool include 6.8 percent in 2019, 3.8 percent in 2020, 3.96 percent in 2021, 5.2 percent in 2022 and 2.9 percent in 2023 to reach $15.7 billion. In party and event, expected growth rates are 6.5 percent for 2019, 5.7 percent in 2020, 5.6 percent in 2021, 5.1 percent in 2022 and 5.5 percent in 2023. Investment in equipment by rental companies in the U.S. is expected to remain relatively flat each year with small declines in spending in 2020 and 2021, followed by slight increases in 2022 and 2023 to reach $14.55 billion. In Canada, equipment and event rental revenue is expected to increase 2.4 percent in 2019 to reach $5.54 billion, with growth of 3.4 percent in 2020, 4.6 percent in 2021, 3.2 percent in 2022 and 2.7 percent in 2023 to reach $6.36 billion. The PSAI collaborates with ARA on projects of mutual interest. For more information about projected revenue growth in the rental industry, contact Tracy Johannsen at ARA via email at tracy.johannsen@ararental.org or via phone at 309-277-4270.