Global Construction Equipment Rental Market Worth USD 149.07 Billion With a CAGR of 4.2%

Introduction

Construction equipment rental is the service of renting construction equipment to end users for a specified period under contracts containing usage terms and conditions. Primarily, construction equipment is used to facilitate heavy operations on construction and mining sites. A rise in construction and mining activities in developing nations of Latin America and Africa drives the expansion of the market for construction equipment rentals. In addition, renting equipment for the necessary time reduces costs associated with equipment maintenance, high operational costs, and high wages of skilled operators, which contributes to the expansion of the market. Additionally, the high initial investment required to purchase equipment and financial constraints can be avoided by opting for rental equipment, thereby fostering market expansion.

Market Dynamics

A Rise in Construction Activities in Developing Countries Drives the Market Growth

In the developing nations of Asia, Africa, and Latin America, ongoing construction projects for malls and offices have been observed. Since 2017, approximately 100 malls have been constructed in Latin America. These malls are multi-story and constructed on numerous acres of land, which has increased demand for construction equipment. In addition, the rapid industrialization of developing nations has resulted in the construction of new, abundant office spaces in major cities. For instance, over 17 major IT parks have been constructed in India's major cities, such as Mumbai, Delhi, Pune, Bangalore, and Hyderabad, over the past few years. Several housing developments are also under construction in Africa. These infrastructure projects require construction equipment.

IoT Technology Creates Opportunities

Technologies like the Internet of Things (IoT) installed in construction equipment have made it easier for rental companies to track the equipment's location and operations. IoT aids in overcoming skilled labor shortages by enhancing work precision, ensuring on-time delivery within budget, and resolving equipment safety issues. Consequently, the introduction of new internet-connected equipment is anticipated to stimulate the growth of the construction equipment rental market over the forecast period.

Regional Analysis

North America is the largest contributor to the global market and is anticipated to grow with a 4.2% CAGR. The market is expanding due to increased commercial infrastructure construction, mining, and remodeling in the United States and Canada. In addition, the United States is a major manufacturing center for construction equipment for many companies, including Caterpillar, Volvo, and John Deere, which is advantageous for rental companies because manufacturers also offer services and maintenance for the equipment.

Europe is the second largest market and is growing with a CAGR of 3.7%. The major players, including Volvo Construction Equipment, Liebherr, and JCB, have their headquarters in Europe and a strong regional presence. The implementation of construction equipment for material handling and earthmoving applications helps end users save time while simultaneously increasing their efficiency. Countries such as Germany, the United Kingdom, France, and others are major centers of development for the manufacturing and energy industries, which increases the demand for rented construction equipment in these nations. This is expected to stimulate the growth of the construction equipment rental market.

Asia Pacific is the fastest-growing market, registering a CAGR of 5.9%. China dominates the market for the rental of construction equipment. However, other nations such as India, Singapore, and Taiwan have been identified as significant markets due to the increase in construction activity in these nations. On the Asian market, Herc Rentals, Kanamoto, and Shanghai Pangyuan Construction Equipment Rental Co., Ltd. are among the most prominent companies. Major players are working on expanding their presence in these markets in order to increase their customer base and better serve the construction, oil & gas, and mining industries in Asia. Consequently, the improvement in overall construction activities in the Asia-Pacific region is likely to generate growth opportunities for the construction equipment rental market in this region.

The LAMEA region is also anticipated to experience substantial growth over the forecast period. The Middle East dominates this market, but Africa is expected to experience the highest CAGR over the forecast period. Emerging regions, such as Africa, are focused on the establishment of new mining operations and the development of infrastructure. Due to numerous construction projects, South Africa has the highest growth potential for the construction equipment rental market. Major construction equipment manufacturers have established subsidiaries to improve sales and services in developing nations. This encourages rental companies to purchase the equipment since they will receive the service and maintenance they require in the long run. These strategies contribute significantly to the expansion of the LAMEA market.

Key Highlights

• The global construction equipment rental market was valued at USD 102.94 billion in 2022. It is projected to reach USD 149.07 billion by 2031, growing with a CAGR of 4.2% during the forecast period (2023–2031).
• By applications, the market is segmented into excavation & mining, material handling, earthmoving, and concrete. The earthmoving segment holds the highest revenue share, registering a CAGR of 5.1%.
• Based on product, the market is divided into backhoes & excavators, loaders, crawler dozers, cranes, forklifts, and others. The loaders segment holds the highest revenue share and is growing with a CAGR of 3.5%.
• Based on propulsion type, the market for construction equipment rentals is divided into electric and ICE. The ICE segment holds the highest revenue share and is expected to grow at a CAGR of 4.1%.
• North America is the largest contributor to the global market and is anticipated to grow with a 4.2% CAGR.

Competitive Players

The most prominent players operating in the construction equipment rental market include Boels Rentals, H&E Equipment Services, Herc Rentals Inc., Kanamoto Co., Ltd., Nesco Holdings, Inc., Maxim Crane Works, L.P., Mtandt Group, Ramirent, Sarens n.v./s.a., and United Rentals, Inc.

Recent Developments

Market News

• In October 2022, H&E Equipment Services Inc. announced that its acquisition of One Source Equipment Rentals Inc. had been completed. With the completion of the transaction, H&E expanded its branch network by ten equipment rental locations, including initial locations in Illinois, Indiana, and Kentucky.
• In November 2021, Rapid Equipment Rental Limited was acquired by Herc Holdings Inc., a North American equipment rental supplier operating through Herc Rentals Inc. Rapid is a full-service equipment rental company with seven locations serving the Greater Toronto Area's construction and industrial clients.

Segmentation

Global Construction Equipment Rental Market: Segmentation

By Application

• Excavation & Mining
• Material Handling
• Earthmoving
• Concrete

By Product

• Backhoes & Excavators
• Loaders
• Crawler Dozers
• Cranes
• Forklift
• Other

By Propulsion System

• Electric
• ICE

By Region

• North America
• Europe
• Asia Pacific
• LAMEA