The construction equipment rental market is poised to be valued at US$ 121 billion in fiscal 2022, a significant increase from the US$ 115 billion recorded in fiscal 2021. The industry experienced a YoY growth of 4.3% in the previous year. Over the next ten years, the market is expected to grow at a CAGR of 4.3%, culminating in a worth of US$ 185 billion by the end of 2032.
The construction equipment rental market has experienced steady growth, driven by several factors. Firstly, the increasing complexity and diversity of construction projects have led construction companies to rely on rental equipment to meet specific project requirements. Furthermore, the capital-intensive nature of construction equipment has made renting an attractive option for companies seeking to minimize upfront costs. The market is characterized by a wide range of equipment, including excavators, bulldozers, cranes, loaders, and more, catering to different construction needs.
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Market Dynamics:
The construction equipment rental market is a dynamic sector driven by various factors such as infrastructure development, urbanization, industrialization, and the growing trend of renting over purchasing equipment. Key players in the market include rental companies, construction contractors, and equipment manufacturers, each contributing to the market’s growth and evolution.
One of the primary drivers of the construction equipment rental market is the increasing demand for construction activities worldwide. Rapid urbanization in emerging economies, coupled with government initiatives to improve infrastructure, has led to a surge in construction projects. This has resulted in a greater need for equipment such as excavators, bulldozers, cranes, and loaders, driving the rental market’s growth.
Additionally, the cost-effectiveness and flexibility offered by equipment rental compared to purchasing have made it an attractive option for construction companies. Renting equipment allows companies to access a wide range of machinery without the significant upfront investment required for ownership. It also provides flexibility to scale up or down based on project requirements, reducing idle equipment costs and improving overall operational efficiency.
Technological advancements have also played a crucial role in shaping the construction equipment rental market. Rental companies are increasingly adopting telematics and IoT (Internet of Things) technologies to monitor equipment usage, track maintenance schedules, and optimize fleet management. These technologies not only enhance operational efficiency but also improve equipment uptime and reduce downtime, thereby maximizing rental companies’ profitability.
Market Future Outlook:
Looking ahead, the construction equipment rental market is poised for steady growth, driven by several factors. The increasing adoption of rental equipment by small and medium-sized contractors, particularly in emerging economies, will fuel market expansion. These contractors often prefer renting over purchasing due to limited capital resources and the need for flexibility in equipment usage.
Moreover, sustainability concerns and environmental regulations are expected to drive demand for newer, more fuel-efficient, and eco-friendly equipment. Rental companies are likely to invest in modernizing their fleets to align with these trends, offering customers access to environmentally friendly options.
Furthermore, the rise of infrastructure projects, particularly in sectors such as transportation, energy, and utilities, will create lucrative opportunities for rental companies. Governments worldwide are focusing on infrastructure development as a means to stimulate economic growth, which will drive demand for construction equipment rental services.
Innovations in equipment technology, such as electrification and autonomous operation, are also expected to reshape the construction equipment rental market. Electric-powered equipment offers benefits such as reduced emissions, lower operating costs, and quieter operation, making them increasingly attractive to rental customers. Similarly, advancements in autonomous technology will improve safety, productivity, and efficiency on construction sites, further driving adoption.
Key Players:
- United Rentals Inc.
- Herc Holdings Inc.
- Ashtead Group Plc
- Aktio Corporation
- Loxam Sas
- Kanamoto Co. Ltd.
- Nishio Rent All Co. Ltd.
- H&E Equipment Services Inc.
- Nikken Corporation
- Cramo Group
- Ramirent Plc
Competitive Landscape:
United Rentals, an online marketplace for industrial and construction equipment rentals, offers a wide range of tools and equipment for users to search and purchase. Their inventory includes compressors, tools, earthmoving equipment, forklifts, vehicles, trailers, and other equipment. To enhance user convenience, United Rentals provides iOS and Android mobile apps. Additionally, they offer fleet and equipment management rental solutions. In the fiscal year 2021, the company achieved impressive financial results, with yearly revenues totaling $9.72 billion and a net profit of $1.39 billion.
In August 2021, Herc Holdings Inc., operating as Herc Rentals Inc., successfully acquired the majority of CBS Rentals’ assets, further expanding their presence in the thriving equipment rental market of Texas. This strategic move adds 38 physical sites to Herc Rentals’ portfolio, enabling them to offer a comprehensive range of general and specialty equipment rental solutions, along with associated services.
Furthermore, United Rentals made a significant acquisition in April 2021 by entering into a formal agreement with General Finance Corp. The deal involved United Rentals purchasing General Finance for a substantial amount of US$996 million. As part of the transaction, United Rentals agreed to acquire General Finance at a cash share price of US$19, assuming a net debt of $400 million. This acquisition further strengthens United Rentals’ position in the industry and expands their capabilities to serve a broader customer base.
Overall, United Rentals and Herc Rentals Inc. demonstrate their commitment to providing top-notch equipment rental solutions, expanding their market presence, and driving growth through strategic acquisitions.
Key Segments Covered In The Market Report
- By Product :
- Earth Moving Machinery
- Material Handling Machinery
- Concrete & Road Construction Machinery
- By Region :
- North America
- Latin America
- Europe
- East Asia
- South Asia
- Oceania
- Middle East & Africa
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