ARA upgrades analytics; confirms positive outlook

01 December 2021

The American Rental Association has upgraded its data and analytics offering to the rental industry amid confirmation of a positive overall outlook for the sector for 2022 and beyond.

ARA Rentalytics, the ARA’s subscription service offering industry data and analysis, is now providing additional information to meet the needs of rental stores and manufacturers serving the North American equipment and event rental industry.

Tom Doyle, ARA vice president, association program development, said in an article published on the ARA website that the new data includes a low-cost state digest for local rental companies, a national data source and, in response to member requests, ARA-driven rental company and consumer surveys.

Offered to ARA members, ARA Rentalytics now has four levels to choose starting with the state digest, which provides a one-year revenue forecast for the national, state and metropolitan statistical areas (MSAs) as well as data related to the national and state forecast economic drivers affecting the rental industry.

Other levels include state, regional and North America subscriptions, expanding the available data beyond what the digest provides.

Meanwhile the ARA’s latest forecast predicts construction equipment rental revenue will rise by 12.3% in 2022 to reach $38.7 billion, amid an overall positive outlook for 2022 and beyond, for equipment rental revenue, comprised of the construction/industrial and general tool segments.

The fourth quarter forecast released in November shows equipment rental revenue expected to grow by nearly 10% to exceed $52.3 billion in 2022, a record for the equipment rental industry, topping the $50.9 billion recorded in 2019.

It also calls for equipment revenue increases of 5.5% in 2023, 2.5% in 2024 and 3.3% in 2025 to reach $58.6 billion.

The revenue from construction equipment rental leads the recovery, with 12.3% increase expected in 2022 to reach $38.7 billion, while the general tool segment is forecast to grow 3.7% in 2022 to $13.7 billion.

The ARA confirmed equipment rental companies cut investment in equipment in 2020 during the early stages of the Covid-19 pandemic, as those in the construction and general tool segments spent 44.4% less in 2020, dropping investment in equipment to more than $7.6 billion.

However, the forecast shows that investment in 2021 should grow by 36.2% to $10.4 billion, followed by another 36% increase in 2022 to total $14.2 billion and to increase 10.9% in 2023, 2.3% in 2024 and 3.8% in 2025 to total more than $16.6 billion.

In Canada, equipment rental revenue is following a similar trend. According to the ARA forecast, construction and general tool rental revenue combined is expected to grow 7.9% in 2022 to nearly $4.6 billion, surpassing the 2021 record total of $4.2 billion in 2018.

While the forecast does not include the potential impact of the US Infrastructure Investment and Jobs Act of 2021 (IIJA), the ARA indicated the results of increased infrastructure spending were unlikely to emerge in 2022, as the money from the infrastructure bill will not be available before January.

In addition, IHS Markit, which provides forecasting data and analysis for the ARA is also monitoring the market to see to what degree inflation, which has not been an issue for well over a decade, is reflected in rental rate increases.

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