The European equipment rental market grew by 7.5% in 2022, according to the European Rental Association’s (ERA’s) 2023 Market Report.

In the 16 countries covered by the report, total rental turnover was EUR28.9 billion.

Most of the positive growth in 2022 is attributed to increased prices rather than significant improvements in activity.

Of the 16 countries, 14 rental markets grew by more than 5% last year.

The UK, Germany and France remain the largest rental markets in Europe, now accounting for almost 69% of the total market size.

Switzerland posted the slowest growth at 1.2%, while Portugal clocked the highest at 18.2%.

Growth is expected to slow to 2.7% in 2023, to a rental turnover of EUR29.7 billion, as high borrowing costs and inflation continue to bite.

“However, high machinery ‎purchase prices and uncertainty about the economic environment is shifting demand to usership over ‎ownership, so the rental market is expected to outperform the construction sector,” the ERA says in a statement. ‎

“Subdued eurozone economic growth, less favourable financing conditions, reduced business ‎confidence and inflation will also weigh on investment.

“The residential sector will remain the main ‎drag on overall growth, while infrastructure projects supported by the EU’s Recovery and ‎Resilience Fund should support the rental market going forward.

“In the longer term, the diversification of the industry away from construction and investments in green projects will ‎benefit the sector growth.”

The ERA’s Market Report, developed in collaboration with S&P Global, looks at 16 countries that account for more than 95% of the equipment rental industry in the EU, the European Free Trade Association ‎‎(EFTA) and the United Kingdom.