Rental Industry Struggling, But Still On Solid Footing

By Jeff Griffin, Senior Editor | July 2010 Vol. 65 No. 7

Drive past most any construction site, and there’s a good chance many of the machines working there are rented, clearly marked by decals of the rental company that owns them.

Most construction specialty niches rent equipment, including utility providers and contractors engaged in underground utility construction. Trenchers, compact excavators, tractor mounted loader/backhoes, skid-steer loaders, air compressors, pumps, and hand-held compactors and tampers are among the most popular rental items by those engaged in underground construction.

Clearly the rental industry has been affected by the current recession, and both the large rental chains and independent rental centers have not replaced equipment in their fleets at regular intervals as they have in the past. That loss of sales to the rental market over the past two years has severely impacted manufacturers serving that market.

All of which begs the question: is the equipment rental industry coming out of the recession? Underground Construction asked Christine Wehrman, executive vice president and chief executive officer, American Rental Association (ARA) to share her views on the state of the rental industry at the mid-year point of 2010.

“Broadly, we can say that the equipment rental industry has weathered the challenging economy better than many industries,” believes Wehrman. “That’s not to say the year was a walk in the park by any means. It was a tough year and there was negative impact. It has been very difficult for a number of companies, depending on the inventory mix, the market they operate in and company management.”

Christine Wehrman

Overall, Wehrman continued, equipment rental revenue is down from its peak, but the decline in rental revenue has not been as severe as for the industries rental companies serve, such as the overall construction market.

Early reports
At ARA’s annual convention and trade show in February 2010, Wehrman said many exhibitors reported a good amount of sales and leads for a variety of equipment.

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