2023 Global Equipment Rental Industry Report

The global equipment rental industry is rapidly expanding, with the global market size forecast to reach $120.7 billion by 2027. The equipment rental industry is set to experience significant growth in the coming years and is becoming an increasingly important part of the global economy.

Construction Equipment Rental
The construction equipment rental segment accounts for the majority of total revenue in the sector globally.

The global construction equipment rental market was valued at $109.4 billion in 2022. The market is forecast to reach $153.1 billion by 2028, growing at a compound annual growth rate (CAGR) of 5.59% between 2023 and 2028. The construction equipment market includes material handling, earthmoving, concrete, and road construction. Earthmoving equipment dominates the construction equipment market. Regarding propulsion systems, the market can be segmented into electric and internal combustion engines (ICE), with the latter holding the most market share. 

The construction industry is thriving worldwide, and there is increasing investment in infrastructural development. These factors are driving the growth of the construction equipment rental market. In addition, as populations rise, governments and private stakeholders invest more in residential and public infrastructure to support their economies. 

Also, automation in the construction sector is another key growth driver. Rental companies offer high-tech machinery equipped with artificial intelligence (A.I.) and professional operators. The goal is to cut the overall costs for the companies leasing the equipment and enhance operational efficiency. 

Other factors driving the construction equipment rental market include urbanization, smart cities, and the developing of advanced equipment with sustainable and eco-friendly features.

Oil & Gas Equipment Rental
The oil and gas sector is expected to contribute to the growth of the equipment rental market because of increased exploration. As the industry increases its activities, the need for rental equipment to support these activities will also increase. Oil and gas exploration activities are projected to contribute significantly towards future market expansion, as well as digitalization, which could result in a CAGR of 5% by 2025. The drilling rig sector is expected to dominate the market due to the increasing exploration and production activities. Also, advancements in deepwater drilling activities in regions such as Brazil, Norway, and the United Kingdom are expected to create ample opportunity for market players in the coming years. While countries such as Argentina, Canada, Australia, and China are investing in the exploration and production of shale oil and gas reserves, North America is forecast to be the largest market for oilfield rental services due to increasing oil and gas activities and offshore reserve exploitation in the U.S.

Power Equipment Rental 
Power equipment rental is also referred to as power on hire. It offers several advantages over purchased power equipment. Rented generators provide flexibility, carry lower maintenance and installation costs, are available on short notice, and offer lower initial prices. Power outages are increasing the demand for reliable backup power sources in both industrial and commercial sectors, driving the adoption of power rental equipment. Additionally, mining activities are among the highest energy consumers from generators, as most mining activities occur in more remote areas outside the power supply grid. The power rental market is expected to reach $28 billion by 2026, indicating that it is a lucrative and growing market. The industry is expected to experience significant growth in the coming years. 

Digitalization
The digitalization of equipment rental services is forecast to boost market growth by a CAGR of 5% by 2025, showing significant potential for the industry in the coming years. Such a considerable increase could result in more efficient and cost-effective rental services and increased customer satisfaction.

The Internet of Things (IoT) is also a driving market trend, allowing companies to track their assets’ movements and offering them more visibility and control on hand. The IoT can also extend the lifecycle of equipment and lower costs through more carefully tracked data metrics. Some estimations report that the IoT has the potential to cut maintenance costs by up to 40% and equipment downtime by up to 50%. The IoT has also been shown to cut costs and time regarding inventory tracking and reduce human errors.

Equipment rental companies also use A.I. for customer relationship management (CRM) purposes. This offers them a better understanding of their customer’s preferences and behavior patterns. It can also aid in getting more accurate order tracking and delivery information, help rental companies automate relationship management, offer better support, and adapt quickly. 

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By Region
The equipment rental market in the United States saw an annual growth rate of 1.5% between 2016 and 2021, and North America held more than half of the global share that same year. The industry is growing steadily in the region, with more businesses choosing equipment rental for their needs. As a result, the equipment rental market in the U.S. is expected to reach $64.71 billion in 2025, growing at a CAGR of 5.47%. In Canada, the size of the construction equipment rental market is expected to reach $536 million by 2026, signifying positive growth in the sector.

The Asia-Pacific region is expected to see the highest growth rate in the world in the coming years, expanding at a CAGR of 6.9% through 2025. 

The equipment rental industry in the European Union is also a strong market, generating revenue of €31 billion in 2019 and acting as a significant contributor to the region's economy. The size of the construction equipment rental market in the E.U. is forecast to surpass $47 billion by 2026. 

M&A
Factors driving M&A in the equipment rental industry include companies partnering with other companies that have specific expertise in an area that the first company may lack. Another driving factor is cost savings through collaboration with another company to help to reduce costs for both parties. Access to new customers and new resources is another critical reason for partnering with another company that has a strong presence in a new market. Additionally, partnering with other companies can boost innovation, leading to the development of new products, services, or technologies that help drive growth and revenue. 

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