ARA increases rental growth forecasts for North America
By Murray Pollok18 May 2012
The American Rental Association (ARA) has revised upwards by nearly 2% its 2012 growth forecasts for the North American rental industry.
The ARA is forecasting growth of at least 8.6% to US$34.1 billion for the full year after a better than expected first quarter of the year. The association estimated growth of around 6.9% in February.
The forecast increase in 2012 is now almost four times the 2.2% growth in US gross domestic product (GDP) forecast for the year.
The ARA's increased growth projections come in the same week that the European Rental Association (ERA) revised downwards its growth projections in response to Eurozone economic weakness and uncertainty.
Christine Wehrman, ARA's executive vice president and CEO, said; "Our growth can be attributed to many things, but first and foremost, we are a solutions based industry. We are seeing a fundamental shift as customers realise the value of renting versus the challenges of ownership.
"This trend was evident in the first quarter and those in the industry are focused on gaining further market penetration via new market segments and selling the value of equipment rental".
Investment in fleet is also increasing, and will reach a value equivalent to 31.6% of rental revenues, or $9.8 billion, according to ARA's consultant, IHS Global Insight.
ARA's current five-year forecast is for the North American rental market to be worth $53.2 billion by 2016. The forecasted rental revenue total includes the three segments of the industry - construction and industrial, general tool, and party and event -- in the US and Canada combined.