The American Rental Association (ARA) five-year forecast updated in late October now forecasts equipment and event rental revenues in North America to exceed $71.7 billion in 2022, including $65.4 billion in the United States and $6.3 billion in Canada.

The latest quarterly forecast again projects greater revenue gains than the previous forecast released in late May for each year from 2018 through 2022.

“We continue to see strong growth in rental revenues through 2018 and into 2019 due to the strong performance of the U.S. economy,” said John McClelland, Ph.D., ARA vice President for Government Affairs and Chief Economist.

“Our forecast for 2019 does indicate slower growth than we have experienced in 2018 because the U.S. economy is projected to grow at a slower rate than in 2018. However, in both cases, rental revenues are expected to grow at higher rates than the economy,” he said.

In the U.S., equipment rental revenue is expected to finish 2018 at $53.04 billion, up 7.6 percent over 2017. Revenue is forecast to grow another 5.5 percent in 2019, 5.9 percent in 2020, 5.1 percent in 2021 and 4.7 percent in 2022.

While the construction/industrial segment remains the largest, its growth rates of 5.6 percent in 2019, 5.3 percent in 2020, 4.4 percent in 2021 and 4 percent in 2022 to $44.85 billion pace below the percentage of revenue increases for general tool — 6.2 percent in 2019, 7.7 percent in 2020, 7 percent in 2021 and 6.7 percent in 2022 to reach $16.34 billion — and for party and event, which is expected to show revenue increases of 6.7 percent in 2019, 5.8 percent in 2020, 5.5 percent in 2021 and 5.2 percent in 2022 to total $4.27 billion.

Scott Hazelton, managing director, IHS Markit, the forecasting firm that compiles data and analysis for ARA Rentalytics as part of a partnership with ARA, said the biggest surprise of the updated forecast has been the resiliency of the U.S. economy.

“After several years of temperate growth, it weathered an energy price hike and then an energy price collapse without significant ill effect. While one has to constantly be aware of the warning signs of a downturn, nothing appears imminent,” Hazelton said.

U.S. investment in rental equipment also is expected to be steady over the forecast period, increasing 2.6 percent in 2019 to $14.3 billion; adding another 4.5 percent in 2020; and then slowing to growth rates of 1.7 percent in 2021 and 1.3 percent in 2022, reaching $15.4 billion.

“Our biggest concerns going forward are the continuing negative effects of tariffs on the rental industry, both from the increasing costs of equipment for all rental segments and construction equipment, as well as the overall fiscal drag that is caused by tariffs,” McClelland said.

In Canada, rental revenue is forecast to grow 4.3 percent in 2018 to total $5.4 billion and then continue to expand with revenue increases of 4.8 percent in 2019, 4.7 percent in 2020, 3.8 percent in 2021 and 2.6 percent in 2022 to total $6.3 billion.