GE Capital expands financing program for construction equipment dealers to support growth in rentals
About half of U.S. dealers offer rentals in addition to sales
GE Capital, Equipment Finance announced that it is expanding its financing program for dealers to purchase construction equipment for use in their rental fleets. About half of U.S. dealers offer rentals in addition to sales — a figure that’s expected to grow in 2014 and beyond.
According to the American Rental Association’s Rental Market Monitor service, the construction and industrial segment of the rental industry will grow 9.1 percent to $24.4 billion in 2014 and 10.5 percent to $26.9 billion in 2015 in the U.S.
“At a time when contractors and construction companies are reluctant to commit to large purchases, equipment dealers are seeing success by offering end-users the latest machines without the big payments,” said Jim Kelly, managing director of GE Capital’s Vendor Finance business.
Dealers typically pay cash for equipment that costs less than $10,000 each, but may be interested in financing more expensive equipment, Kelly explained, particularly through GE Capital’s offer of line-item financing where equipment is purchased unit-by-unit, allowing dealers more flexibility than an asset-based loan for a pool of equipment.
Equipment rentals have grown in each of the past three years, according to Frank Manfredi, president of Manfredi & Associates, Inc., a market research and consulting firm that specializes in the industrial sector of the rental industry. He estimates that about half of U.S. dealers offer rentals in addition to sales and he expects the market for equipment rentals to continue to grow.
About the Author
Lisa Tibbitts is a media relations specialist at GE Capital.