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Equipment Rental Industry: Growth, Trends, Challenges, and Future Scope

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The worldwide demand for various construction and material handling equipment (MHE) makes the equipment rental industry highly resilient. Further accelerated by both commercial and residential development projects, such as construction, landscaping, house renovation, mining, and infrastructure development, the global equipment rental industry is set on the trajectory of steady and inevitable growth. 

In terms of business scope, many new players are entering the industry and competing against incumbents with impressive value propositions. A growing business model that many new entrants are adapting is the B2B aggregate marketplace model. This model connects local contractors with thousands of independent equipment owners and suppliers and helps with their sourcing needs.

This guide helps you understand the ins and outs of the equipment rental industry. If you are looking forward to joining the heavy equipment rental industry then the following insights can help you identify the most potential business areas for investment. Let us begin with statistics and key growth factors.

Equipment Rental Industry Statistics

For a thorough analysis, we can break down the global equipment rental industry into various sectors such as construction equipment, material handling equipment (MHE), and aerial work equipment. Following are the equipment rental industry’s most noteworthy statistics:

  • The global construction equipment rental industry started the year 2024 with a market share of $116.5 billion.
  • It is expected to capture another $71.7 billion by the end of 2032, marking a compound annual growth rate of 5.3%.
  • The North American market was $42.64 billion in 2022 and is expected to reach $58.49 billion by 2029.
  • The European construction equipment rental market size is $33.60 billion in 2024 and is expected to reach $43.19 billion by 2029.
  • The Gulf Cooperation Council countries (GCC) have a market size of $4.86 billion in 2024 and are expected to reach $6.55 billion by 2029 at a CAGR of 6.5%.
  • The GCC region also accounts for having the maximum number of large-size billion-dollar construction projects, such as NEOM city ($500 billion), Dubailand ($64 billion), Gulf Railway ($250 billion) Al Maktoum International Airport ($33 billion) and King Abdullah Economic City ($100 billion).
  • The global MHE industry with rental as a primary contributor is worth $206.85 billion in 2024 and is expected to reach $270.53 billion by 2028 at a CAGR of 6.9%.
  • The full-service long-term MHE rental market captured $21.56 billion in 2023 and is projected to reach $43.3 billion by  2030, at a CAGR of 9.4%.
  • The US MHE rental industry is expected to reach $7.32 billion by the end of 2028.
  • In 2023, the European region captured 28% of the global MHE industry market share.
  • The global scaffolding rental market is growing at a CAGR of 8.2% and is expected to double its size in the forecast period 2022-2030.
  • In 2023, the European scaffolding rental market share was 22.6% of the global market.
  • The German CAGR rate in the scaffolding rental industry is 7.1% (2023-2033).
  • The aerial work platform rental industry is expected to reach $69 billion by 2030.
  • The overall global aerial work platforms market is expected to grow at a CAGR of 8.9% in the forecast period 2024-2033.

Key Growth Factors in the Equipment Rental Industry

  • Rapid Urbanization: Rapid urbanization in developing countries and rural areas is catalyzing demand for equipment rentals by encouraging various types of construction projects.
  • Increase in Construction Projects: The increase in the number of commercial, residential, infrastructure, industrial, and institutional projects is also paving the way for the proliferation and growth of rental equipment.
  • Low Tax Liability on Rented Equipment: Construction companies and general contractors are not required to pay the hefty upfront taxes on renting equipment. Additionally, they can claim the rental charges as a deductible during the taxation process, making renting equipment a much wiser option than purchasing.
  • Renovation of High-rise Buildings: Certain types of equipment, such as aerial work platforms and scaffoldings are witnessing an increase in rentals because of renovation and repair work required in high-rise buildings.
  • Growth in Mining and Extraction Activities: With the exploration of new mining sites and oil rigs, there comes an increased demand for heavy construction equipment such as excavators, bulldozers, dump trucks, and drills.
  • Low Downtime: For renting heavy equipment, the rental company is responsible for servicing and maintenance. Thus, in case of any breakdowns, the contractors can ask for a replacement which decreases the overall downtime for the project.
  • Environmental Concerns: Due to the various environmental concerns and related regulations, more contractors are in favor of using eco-friendly equipment. For contractors, rental remains the quick, easiest, and most reliable way to test and adapt electric-powered equipment and other green fuel equipment.
  • DIY Proliferation: For power tools and other handheld equipment, the Do-it-Yourself (DIY) trend is generating demand.

Trends and Technological Advancements

  • The Internet of Things (IoT) and telematics are streamlining fleet management in the equipment rental industry. By enabling real-time monitoring and collecting field data, IoT is helping businesses make important decisions, including those for improved efficiency, preventive maintenance, warehousing, and ensuring on-site security.
  • Along with IoT, Artificial and machine learning are assisting contractors in preventive maintenance and ensuring reduced downtime. Going a step further, AI is predicting fuel shortages, excessive wear and tear and timely sending important updates to supervisors.
  • Digital Transformation is shaping various processes in equipment rental. From inventory management, inventory, and invoicing to agreement management, rental security, and quotations, rental software are automating a wide range of key processes and operations, thus, immensely reducing operational costs and chances of errors.

Readymade Software for Equipment Rental Businesses

 

  • With the advent of electric vehicles, construction equipment also underwent an electric revolution. Due to increased preference for green fuels and various government regulations, the demand for electric-powered equipment is on the rise. Some top manufacturers of electric heavy equipment are Develon (Doosan), Bobcat, Caterpillar, Case, and Ausa.
  • For enhancing worksite safety, modern construction equipment is integrated with motion sensors and facial recognition technology. These technologies can help recognize signs of fatigue or any other dangerous operator behavior. Additionally, motion sensing technology can recognize moving objects, such as other workers and animals, and prevent serious accidents.
  • The modular construction sector is also influencing the demand for certain types of heavy equipment, such as cranes, loaders, and excavators. Modular construction refers to a different type of construction strategy where parts of the building are constructed somewhere else and then the entire building is assembled at the construction sites.
  • Unmanned Aerial Vehicles (UAV), widely popular as drones have established their space in the equipment rental industry. Drones are quick and efficient ways of remotely monitoring work progress and supervising the same. Furthermore, drones can perform many actions better than manual workers, such as supervising work at high-rise buildings and identifying any worksite dangers and hazards.

Top Players in the Equipment Rental Industry

The equipment rental industry is highly fragmented. It has both offline and online players. However, a few players have always persisted and proven themselves to be at the forefront. These players timely underwent a digital transformation and are now leading in both offline and online equipment rental operations.

Player CEO Estimated Annual Revenue
United Rentals Matthew Flannery $9.4 billion
Sunbelt Rentals (Ashtead Group) Brendan Horgan $8 billion
Herc Rentals Lawrence H. Silber $2.5 billion
Loxam Gerard Déprez $2.5 billion
Home Depot Rentals Edward Decker $2 billion
H&E Equipment Services Bradley W. Barber $1.1 billion
EquipmentShare Jabbok Schlacks $1 billion
Sunstate Equipment Co Chris Watts $748 million
Zeppelin Rental Arne Severin $700 million
Maxim Crane Works Paul McDonnell $618 million

Also checkout: car rental market trends & opportunities

Funds Raised by Startups in the Equipment Rental Industry

Along with the aforementioned dominant players, many startups have also joined the industry and shared ripples across the entire business landscape. With a strong value proposition and commitment to quality, the following startups were able to secure financing from renowned investors. These businesses also represent the openness of the industry in embracing innovation and welcoming new players.

  • DOZR: Canada-based equipment rental company raised a total of $44 million in Series B funding.
  • Tendered: UAE-based startup that raised $5.92 million in series A funding.
  • KLARX: A German equipment rental startup that raised a total of $18 million in 3 rounds
  • YardLink: A UK-based startup that raised $17.5 million in Series A funding in 2022.
  • KWIPPED: A B2B equipment rental marketplace raises $1.3 million in funding.
  • InfraFleet: A UK-based clean heavy equipment rental company raised $12.7 million in 2023
  • Rendalo Maq: A Chile-based equipment rental marketplace that raised a total of $4.2 million in funding. Its latest round closed at $3.9 million.
  • GetMyEquipment: UK-based startup that received $477K in funding.
  • RentAlpha: An India-based startup that raised a total of $36.2 million in 5 rounds of funding.
  • Digando: A German B2B rental marketplace also raised an undisclosed amount recently.
  • Boels Rental: A Netherlands-based equipment rental startup secured a $447 million bond at 6.25% in 2024.

Secure Funding for your Equipment Rental Business with a Full-fledged Marketplace

Opportunities in Launching an Equipment Rental Business

Based on a thorough evaluation of the aforementioned insights, there are lucrative opportunities for new entrants and founders in the following areas:

  • Considering the various benefits of the rental equipment and the rate of inflation, contractors are looking for a diverse range of heavy equipment on a rental basis. Thus, to capitalize on the opportunity, launching a B2B equipment rental marketplace makes sense where you can onboard multiple suppliers and offer a broad catalog of rental equipment.
  • Due to numerous large-scale construction projects in the Gulf region, costing billions of dollars, it is the right time to enter the Gulf market with your own equipment rental business.
  • High-rise buildings require maintenance work and timely renovation. However, any such projects are difficult without proper scaffoldings. To help metro cities and contractors in the maintenance of high-rise buildings, founders can invest in a scaffolding rental business as well.
  • The demand for Material Handling Equipment (MHE) in sectors, such as construction, mining, deforestation, and warehousing is surging. The MHE rental niche also has an impressive growth rate of 9.4% in the forecast 2024-2030, making it a lucrative opportunity for new entrants.
  • The DIY industry has elevated the demand for power tools. Different types of DIY projects require different types of power tools and to procure them, rental is the most convenient way for DIY enthusiasts.
  • Currently, the number of equipment rental businesses with electric fleets is not on par with the rising demand. Thus, there remains an opportunity to rent out clean and energy-efficient equipment.

Conclusion

Rental equipment has become a necessity for all sizes of construction companies. With the help of rented equipment, contracts can easily deliver important projects within the estimated timeline and without exceeding the budget. Along with large-scale projects, rental equipment also comes in handy in small construction projects or house renovation tasks. Considering the various other use cases for rental equipment along with their myriad benefits, the equipment rental industry is expected to flourish and bring desired returns to various businesses. To enter the industry with your equipment rental store, taking the digital route remains a highly practical way. Learn more about how Yo!Rent can help you build your online equipment rental store and enter the industry with full confidence.

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