Construction Equipment Rental Market size is expected to reach USD 280 billion by the end of 2035, witnessing around 6% CAGR during the forecast period, i.e., 2023-2035. In the year 2022, the industry size of construction equipment rental was USD 195 billion. The growth of the market can be attributed to the recovery of the construction industry in many parts of the world after a period of stagnation during COVID-19. For instance, construction activities in Latin America have been predicted to show an average growth of about 4% from 2020-2023. Further, the South and South-East Asian regions have been projected to show remarkable growth in the construction industry by the end of 2023.
Another factor that is expected to lead to market growth is the increasing rental penetration in some parts of the world. For instance, the share of the construction equipment in India which was rented constituted only about 48% in 2010. In 2020, this proportion of machines had risen to ~68%. However, the rental business penetration was still very locally-focused in 2020. It is estimated that more than 44,999 units of the machine were sold in the rental business in India in 2021. Similarly, the regions with low or marginal rental penetration compared to others indicate opportunities for further growth of the market.
Growth Drivers
Growth of Residential Construction Projects in Developed Nations - The market for rental construction equipment is expected to witness growth as a result of the flourishing of residential construction activities in the United States (U.S.) and Europe. For instance, the university town of Tucson in Arizona boasted the construction of over 1499 conventional apartments in 2021. Similarly, about 2,486 square feet was the average size of a house built for sale for a single-family in the United States (U.S.) in 2021.
Growth of the Mining Industry in Developing Nations in MEA and Latin America - It is estimated that Africa should have more than 210 mining and infrastructure projects in the energy and power sector by 2030. Equally worth mentioning is the presence of Chile and Peru, two of the world's largest producers of copper in the Latin American region. It is estimated that Chile alone held ~29% of copper produced globally in 2020.
Challenges
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Base Year |
2022 |
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Forecast Year |
2023-2035 |
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CAGR |
~ 6% |
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Base Year Market Size (2022) |
~ USD 195 billion |
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Forecast Year Market Size (2035) |
~ USD 280 billion |
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Regional Scope |
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Application (Residential, Commercial, Industrial)
Construction equipment rental market is also segmented and analyzed for demand and supply by application into residential, commercial, and industrial. Amongst these applications, the commercial segment is expected to garner a significant share by the end of 2035. Commercial construction, such as offices, hotels, and restaurants is a great means to attract substantial investments for a region's development. It is estimated that globally, the floor space of commercial buildings should grow to 125 billion square feet by 2050. The figure reflects the growth of up to 36% from that of 2021. The rising interest rates for single-family buildings are thought to indirectly contribute to the surge in the number of construction activities involving commercial property. There is also a great demand for building space for offices and shops in many parts of the world. This requirement for buildings and space for commercial purposes is also expected to lead to a high demand for construction equipment for rent.
Product Type (Earth Moving Machinery, Material Handling Machinery, Concrete & Road Construction Machinery)
Construction equipment rental market is segmented and analyzed for demand and supply by product type into earth moving machinery, material handling machinery, and concrete and road construction machinery. Out of these types, the earth moving machinery segment is estimated to gain the largest market share over the projected time frame. The segment held about 56% of the global market revenue share in 2022. The increased undertaking of commercial and residential construction projects by various governments is expected to encourage contractors and firms to lease earthmoving equipment. As the increase in construction projects are the result of the growing industrialization and urbanization of a region, these aspects are expected to contribute to market growth indirectly. According to the World Bank, the urban population comprised 56% of the total world population in 2019. Quarrying and mining activities are expected to make use of earthmoving equipment the most. Some mostly used earthmoving equipment include backhoe loaders, mini excavators, crawler excavators, and skid-steer loaders.
Our in-depth analysis of the global market includes the following segments:
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By Product Type |
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By Application |
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APAC Market Statistics
The Asia Pacific construction equipment rental market, amongst the market in all the other regions, is projected to hold a significant market share by the end of 2035. The regional market is expected to grow at a rate of ~6% during the forecast period. The growth of the market can be attributed majorly to the significant investments being made in the development of dams, airports, special economic zones, highways, and more. For instance, the spending on airports in Asia Pacific is expected to surpass USD 1 trillion by 2041. Further, about USD 560 billion of this sum is to be spent on the region's new greenfield airports. These initiatives mainly intend to improve the overall economy of the region by boosting trade and connectivity. However, these extensive initiatives are expected to attract the leaders in the construction equipment rental business to set up their company or invest in the expansion of their company to this region, thus leading to regional market growth.
North American Market Forecast
North America is another region that should exhibit remarkable growth in the construction equipment rental market by 2035. The region held a share of more than 31% of the global market revenue in 2022. One of the major reasons for the growth of the regional market growth is the extensive construction activities that are undertaken by Canada. The number of immigrants to Canada has increased considerably in recent years. The increase in the number of immigrants is attracting significant investment from the regional government for the development of construction infrastructure to address the changing demands of both the immigrants and the citizens. It is estimated that the construction of ~83,481 units of new homes started only in the Ontario province of Canada in 2022. Further, emphasis is being laid on the use of specialized equipment to optimize the mining and construction activities in the region, and this is expected to create opportunities for market growth.
Europe Market Forecast
Europe is also expected to hold a significant share of the global market by the end of 2035. The demand for residential buildings in Europe region is climbing. The climbing demand is, in turn, helping the recovery of the construction industry in the region. Further, many initiatives are being undertaken by the regional governments to improve the infrastructure. All these are encouraging businesses in the construction industry to enter into partnerships with service enterprises in consulting firms, design, and equipment rental. Such partnerships should contribute to the growth of the regional market for construction equipment rental during the forecast period considerably.
LOXAM announced acquiring HR – ALUGUER DE EQUIPAMENTOS S.A. The company added that through the acquisition, it aims to consolidate its presence in the equipment rental market in Portuguese. With the latest acquisition, Loxam has completed its network of 6 branches in Portuguese. HR operated 3 branches with about 40 employees in the country.
H&E Equipment Services, Inc announced completing the acquisition of Rental Inc., an equipment rental company focusing on non-residential construction. With the acquisition, H&E expected to expand its business in Western Georgia, Alabama, and Florida.
Author Credits: Rushikesh, Richa Gupta
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