US equipment rental trends spilling into global market

Equipment rental trends in the United States — including aggressive fleet refreshing, usage-based financing and one-stop shopping — are permeating the globe, creating both challenges and opportunities for many rental companies.  

The global equipment rental market is projected to grow nearly 80% to $264.5 billion by 2034 from $147.4 billion in 2024, according to Global Market Insights. 

Roughly 72% of more than 125 contractors surveyed in North America reported renting equipment over the 12-month period ending in July, according to equipment market research firm EquipmentWatch. 

The same factors driving record growth in the U.S. rental market are creating a domino-effect spanning the world, necessitating close observation of key trends and policies to stay ahead of the curve, Michael Larsen, co-host of the Rental Journal Podcast, which interviews rental executives from across the globe, told Equipment Finance News.  

Larsen also works at Queensland, Australia-based Larsen’s Air Conditioning Hire, a rental provider of industrial HVAC and portable energy solutions for heavy industries.  

Financing trends 

Aggressive fleet-refresh strategies are among trends expanding globally, Larsen said, noting that this is “a financing conversation as much as an operational one.” 

“In the U.S., cheap financing can accelerate turnover, pushing older assets into secondary markets quickly.”

— Michael Larsen, Rental Journal Podcast

“In Australia, we’ve been slower to adopt cycling fleets, partly due to the distance from OEM suppliers, paired with the higher capital costs associated with importing,” he said.

The rise of usage-based financing is another model influencing global trends, Larsen said.  

Usage-based payment models allow rental companies to “expand their fleets without straining cash flow,” Heidi Brooks, program manager at global equipment financier DLL, previously told EFN.  

While usage-based financing is appealing in that rental houses and lenders share risk while benefiting end-users, “there’s definitely a caution to this model,” Larsen said. 

“It’s very good for these high-utilization or predictable assets, but when it comes to remote locations, like here in Australia, or very seasonal markets, where usage is very volatile over several months or during a harsh season, it can really turn this model completely upside down,” he said.  

Moreover, multinational equipment lenders are responding to growing demand for rental-purchase options, which are becoming more enticing as the average fleet gets younger, Bas Bennebroek, chief financial officer of Dutch lender Beequip Equipment Finance, told EFN. 

“The equipment is only 2 or 3 years old,” he said. “That is something that we are trying to capitalize on.”  

‘Walmartification’ of industry  

Industry giants such as United Rentals, Herc Rentals and Sunbelt Rentals often spur trends that many small and mid-sized companies feel pressured to emulate, both in the United States and abroad, Larsen said.  

For instance, United Rentals is offering essential job-site products and services beyond equipment, including mobile container offices, lighting and furniture.  

Moves such as this contribute to the “Walmartification” of the rental industry, Larsen said. 

“The customer wants to be able to get everything from one place. That’s probably what United and the other majors are moving toward. How can we be a one-stop shop for every single thing that our customer requires?” 

— Michael Larsen, Rental Journal Podcast

In addition, large industry players offer same-day delivery for some units, creating an “Amazonification” effect, which can challenge smaller companies and providers of large machinery, Larsen said.  

“For a rental company to get you a 120-foot boom in the same way as Amazon to deliver your iPhone, there’s a lot more moving parts and requires a lot more specialization,” he said. 

While fast delivery of heavy-equipment is not feasible for many, rental companies are leaning into technology to provide near-instant service, he said.  

“One thing we have to be very cautious of is that fine balance between customer service and data-driven decision-making,” Larsen said. 

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