After re-assessing the dynamics of the industry the American Rental Association (ARA) has revised its growth predictions for this year from $48.9 billion to $49.4 billion, registering an increase of nearly $500 million from its last predictive forecast issued at the start of this year in January.
These figures are issued after expected revenue from different streams such as; industrial, construction, general tool and light construction are accumulated for the upcoming year. Growth rates for the upcoming years will not see a spectacular rise or fall but will remain steady with an expected growth rate of 4.7 percent in 2018, 5.1 percent in 2019, 4.6 percent in 2020 and 4.4 percent in 2021. At the end of this period, the ARA has predicted that the rental industry would stand at around $59.4 billion.
The compound annual growth rates for the period between 2017 and 2021 will register growth between the rates of 4.1 percent and 6.1 percent for the construction and industrial equipment sector and the general tool categories. According to the ARA, there has been a general slowdown in trends like non-residential construction and the future is still quite uncertain over how infrastructure spending trends will pan out in future markets.
Definitely going below the mark, the rental equipment industry could certainly stand to do well if investment trends begin to rise for at least two straight quarters and inject an amount of optimistic momentum into residential and non-residential construction markets.
The economic forecasting firm HIS market works on behalf of the ARA to collect and compile the data required to make a quarterly projection and these forecasts are then issued under the name of the ARA rental market monitor. The US economy has registered weak growth in the initial quarter, which makes it harder for predictions to provide a highly optimistic outlook for the remaining part of the year, despite the fact that there has been a positively robust pattern in investment.
Trump’s administration has definitely been of help in reviving investment and promoting internal business friendliness among the business community. This has helped the rental equipment industry to seek renewed growth for itself in the upcoming times and maybe, the next quarterly report might again revise the growth predictions to an even higher number. More businesses are now willing to work in the US, due to the receding tax rates, a scenario which will definitely bode well for the future of the rental equipment industry.
The initiatives by Trump’s administration might make things look optimistic, but the results of these very initiatives stand in the long term. They will not affect things directly in 2017 and will take a couple of years before results show a more complete effect of how these policies played out over the years.