The North American oilfield equipment rental market was valued at $8.6 billion in 2013, and is estimated to grow at a CAGR of 15% to reach $17.3 billion by 2018.
Equipment Rental Market Forecast
According to IHS Global Insight, the world’s leading economic forecasting authority, the United States Equipment Rental Business is growing three to four times faster than the general economy.
In 2013 rental revenue reached $33.3 billion, up 6.4% from 2012 and up 24.2% versus 2010 when rental revenues of $26.8 billion reached a low point in the midst of the great recession.
In 2014 rental revenue is expected to reach $35.9 billion, up 7.7% versus 2013.
2015 rental revenues are forecast to be $39.8 billion, well above the $36.9 billion record level seen in 2007. By 2018, revenues are expected to reach $51.0 billion, almost double the depressed 2010 level of the last recession.
This growth has been fueled by an increase in rental penetration as both consumers and businesses have discovered that it is less expensive to rent than to buy. As a result, more and more equipment is being manufactured for the purpose of rental. Another factor influencing the future growth of the category is the currently pent up demand for housing. All during the recession, the population continued to grow and new households were formed, but many of these new households did not live in their own housing, preferring instead to live with relatives and others. Eventually this pent up demand will materialize in new construction which will further drive the growth of our industry.
Looking at the major sub-segments of the category, IHS Global Insight forecasts the following:
- Construction and Industrial Equipment Rental revenue will reach $24.1 billion in 2014, up 8.2% from 2013. By 2018 revenues will reach $34.3 billion, up 53.8% versus 2013.
- General Tool Rental revenue will grow to $9.1 billion, up 7.3% versus 2013. By 2018 revenues will reach $13.7 billion, up 61.2% versus 2013.
- Party & Event Rental revenue will be $2.6 billion in 2014, up 4.4% versus 2013. By 2018, revenues will be $2.9 billion, up 16.0% versus 2013.
Calgary Economic Development presented 2015 Economic Outlook yesterday. See recent forecast of Canada, Alberta and Calgary Economy here.