Making the decision to rent equipment or use an owned asset is always a difficult one, and this decision can be influenced by many different factors such as expected time on job and expected use hours. Understanding the local rental market as well as internal charge rates is incredibly important to successfully make this decision. However, knowing general patters between average rental costs compared to average ownership costs for different types of equipment can also be a huge help in making that decision. After analyzing 79 different subtypes of equipment on a monthly, weekly, and daily basis, the five subtypes with the smallest variance between average rental rates (using EquipmentWatch Rental Rates) and average ownership costs (using EquipmentWatch Cost Recovery) quickly became clear.
The graph above depicts just how small the variance between rental rates and ownership costs can be. Truck Mounted Hydraulic Cranes—Single Engine have the smallest average variance (0.98%) with average monthly rental rates and average monthly ownership costs being almost identical. Single Engine Conventional Scrapers come in a close second with a 1.27% variance where monthly retail rental rates are slightly higher. Trailer Mounted Brush Chippers follow closely behind with a 1.58% variance where, monthly ownership costs are higher on average. Coming in fourth are Lgp Crawler Loaders with monthly retail rental rates being 2.27% higher on average. Rounding out the top five subtypes with the smallest variance, are Tilt Deck Utility Trailers with average monthly rental rates being 2.56% higher.
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Looking at the differences between weekly rental rate and weekly ownership rates, we can see that the variance between the top 5 subtypes of equipment is still very narrow. Straight Mast Rough Terrain Lift Trucks have the smallest weekly variance on average with retail rental rates being 0.89% higher. Looking at Standard Crawler Dozers, average weekly retail rental rates are also higher with a 1.45% variance. Next are Self Propelled Pavement Breakers where weekly retail rental rates are 2.24% higher on average. On the flip side, Telescoping Boom Rough Terrain Lift Trucks, have weekly ownership rates that are 4.03% higher on average than weekly rental rates. Similarly, Standard Crawler Loaders also have weekly ownership rates that are 4.05% higher than weekly rental rates on average.
Once again, looking at daily rates, the variance between retail rental and ownership costs is very small. On average, Trench Compactors have daily ownership costs that are 0.02% higher than daily rental rates. Crawler Mounted Lattice Boom Cranes also have higher daily ownership rates, on average, with a 3.34% variance. Manually Guided Vibratory Compactors have daily retail rental rates that are 3.43% higher on average than daily ownership costs. Wheel Mounted Grapple Log Skidders are next with daily ownership rates 4.34% higher that rental rates. Lastly are Wheel Mounted Cable Log Skidders with daily retail rental rates being higher by 5.39%.