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Rental & Leasing Services — industry outlook

  • Period: 2026-09-16 to 2026-10-07
  • Events: 4
  • Generated: 2026-10-07T06:30:00.003Z

Transactional Earnings Recovery and Fleet Utilization

Ryder System (R) projects $250 million in additional earnings from transactional segments by FY2027, driven by a supply-side market recovery rather than immediate demand surges. The company anticipates mid-single-digit sequential pricing growth in used vehicle sales for the remainder of the year, supported by capacity exits and rising new equipment costs. Despite this, Ryder expects no significant rental demand recovery beyond seasonal trends in the near term, noting its fleet is currently 20% lower than pre-COVID levels (approx. 10,000 units below peak). Full fleet investment to capture future demand is targeted over the next 12–18 months, with current utilization in the mid-70s and a target range of the mid-70s to high-70s. In contrast, FTAI Aviation (FTAI) outlines an aggressive expansion narrative for its Aerospace Products segment, projecting revenue growth to $4.7 billion and EBITDA to $1.4 billion next year. FTAI plans to raise its normalized EBITDA margin to 30% over the next two to three years to capture market share, moving down from initial 40% levels.

Structural Shifts in Fleet and MRO Economics

Ryder System (R) identifies a structural shift toward dedicated solutions driven by driver shortages, insurance cost inflation, and the Montgomery ruling, which negatively impacts brokerage models (3% of its business) while boosting its dedicated pipeline to record highs. The company expects the EPA 27 regulations to increase fleet renewal costs, accelerating lease decisions and pushing customers toward outsourcing. FTAI Aviation (FTAI) describes a similar structural erosion of OEM aftermarket dominance, anticipating GE and Safran's share of CFM56 shop visits will drop from ~20% to "very low" levels as they focus on new engine backlogs. FTAI aims to capture 10%+ of the current CFM56 and V2500 market with a goal to service 100% of customer shop visits via its vertical integration model. Both companies highlight pricing power derived from these shifts: Ryder expects significant new equipment price increases, while FTAI accepts lower margins (30%) to secure volume over high-margin, low-volume strategies.

Capital Allocation and Expansion Timelines

Ryder System (R) targets $13 billion in capital allocation over the next three years, with $9.5 billion designated for lease replacements and dividends, and $4.5 billion for discretionary spend including growth and acquisitions. The company aims to complete a $170 million underlying cost savings program by end of FY2026 and an $18% return on equity (ROE) target. FTAI Aviation (FTAI) has authorized $500 million in share buybacks and is raising SEI-2 to reach a total assets under management (AUM) target of $20 billion. FTAI plans to add 3,000 modules of annual capacity through facilities in Cairo and Indonesia, while Ryder targets volume growth of 2,000–4,000 vehicles annually on its lease side to maintain high-quality returns.

Power Generation and Autonomous Readiness

FTAI Aviation (FTAI) targets $7 million to $8 million EBITDA per unit for its power conversion business, with the first units launching next year and a potential to extend engine life by 20 years. The company addresses labor constraints by implementing VR training in Montreal, increasing mechanic yield from ~50% to >90%. Conversely, Ryder System (R) views autonomous trucking as several years out from commercialization due to unresolved liability, OEM readiness, and the lack of a national regulatory framework. While Ryder maintains partnerships with Aurora, Kodiak, and Gatik to provide future infrastructure services, it anticipates no immediate impact, whereas FTAI focuses on immediate data center power demand shortages to drive its engine-to-power conversion strategy.