In its updated forecast, the American Rental Association (ARA) shares that the U.S. construction and general tool rental industry finished 2024 as an $83.3 billion industry, an 8-percent growth from 2023. Additionally, the industry is projected to grow 5.2 percent in 2025, totaling $87.5 billion. Beyond 2025, growth is projected to slow to 4.1 percent and 4 percent in 2026 and 2027 respectively. This corresponds with projected moderated investment in both the construction and general tool industries in the coming years.
“Economic uncertainty and relatively high financing costs, underscored by the recent Fed decision, weigh on the outlook for investment,” says Scott Hazelton, managing director at S&P Global, the international forecasting firm that compiles data and analysis for the ARA forecast. “However, this is little risk of a serious downturn, and equipment rental can gain penetration in uncertain times. Our equipment rental outlook for 2025 has been lowered from our view last quarter, however, we still project equipment rental growth at about twice the rate of real GDP and inflation.”
Notably, as businesses chose rental over ownership, the construction and industrial equipment (CIE) rental penetration rate increased for the fourth year in a row to 57 percent in 2024—higher than the pre-pandemic peak.
For more, visit www.ararental.org.