Media Release: Canadian Rental Association Anticipates Strong Growth in Equipment Rental Industry
[Stoney Creek, Ontario] – The Canadian Rental Association has released its latest quarterly economic forecast for the Canadian Event and Equipment Rental industry, showing significant growth in equipment rental revenue in 2022 and forecasting a continued upward trend for 2023.
According to the forecast, equipment rental revenue in Canada is estimated to have increased by 16.4% in 2022 to reach $6.2 billion, and is expected to grow by 5.0% in 2023, up from the Q4 2022 forecast. The growth forecast for 2023 is attributed to the recession being removed from the first half of the 2023 forecast. The equipment rental industry is expected to grow at a rate of 3.4-3.6% per year in the medium term, and is projected to reach $7.5 billion by 2027.
The construction and industrial equipment rental sector saw significant growth in 2022, with an estimated 13.2% increase in revenue to $4.6 billion. The report notes that the growth in the sector was driven by a strong first half of the year in the construction markets, rising industrial production, and growing oil sands investments. The sector is expected to expand further in 2023 by 5.3%, with revenue reaching $5.6 billion by 2027.
The general tool rental segment also experienced growth in 2022, with an estimated increase in revenue of 16.4% to reach $1.3 billion, a new high point in rental revenue. The report notes that while moderate growth in construction is expected, it will yield lower growth rates in the coming years. Slower growth is expected to continue in 2023, with revenue rising 3.6%. Nonresidential structures growth provides a bigger support than the residential market as the housing market cools. By 2027 rental revenue in this segment will reach $1.5 billion.
Finally, tent and event rental revenue returned to pre-pandemic levels, with growth of 102% in 2022. The continued re-opening of the economy allowed the industry to return closer to the ‘norm’, but the economic slowdown is expected to soften the recovery rate. In 2023, the segment is expected to expand by 4.9%, followed by further growth in the 2024-2027 period. By 2027, tent and event revenue should reach $400 million.
“The growth projections for the Canadian Event and Equipment Rental industry are very encouraging,” said CRA CEO, Nathalie McGregor. “The industry has shown remarkable resilience in the face of economic uncertainty, and we are excited to see such strong growth in 2023 and beyond.”
The report notes that Canada’s economy is rolling along swiftly in the first quarter thanks to solid supply, and demand, side fundamentals. However, the robust expansion is not anticipated to last, and the economy’s growth is expected to gear down thanks to easing demand conditions as previous interest rate hikes permeate the broader economy. The mild or shallow recession anticipated in previous forecasts has been removed in the April forecast. The general drivers of soft growth this year and next are unchanged: in particular, weaker household consumption, declines in residential investment, and slowing nonresidential investment spending.
“While there are challenges ahead, we are confident that the Canadian Event and Equipment Rental industry will continue to grow and adapt,” said McGregor. “We look forward to supporting our members as they navigate the changing economic landscape.”
All CRA members receive complimentary access to a quarterly summary update webinar, and detailed quarterly economic forecast data is available as a subscription service by contacting CRA at (905) 643-2333.
About CRA: (crarental.org) The Canadian Rental Association, Stoney Creek, ON., is the leading trade association for event and equipment rental businesses in Canada. CRA advocates on behalf of its members to government, regulators, and other stakeholders, and provides industry insights, best practices, education, and networking opportunities.
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