Confidence High in Equipment Finance Industry |
|
Contributed by BSM Staff | |
WASHINGTON -- Confidence in the equipment finance market is high, according to a new survey, which found demand for leases and loans to fund capital expenditures will increase over the next four months. The July 2021 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) is 72.9, an increase from the June index of 71.3. The index reports a qualitative assessment of both the prevailing business conditions and expectations for the future as reported by key executives from the $900 billion equipment finance sector. “Many industries served by the equipment finance segment are back to full throttle,” said survey respondent Bruce J. Winter, president, FSG Capital. “With only certain negatively impacted industries still working towards recovery. This has created growing demand for our products and services and all signs point to increasing activity over the next few quarters. Inflation concerns, driven by unprecedented federal stimulus spending, are front and center, and the jury is out as to whether the Fed has correctly forecasted only a short-term bump in inflation.” July 2021 Survey Results: • 55.2% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, up from 51.9% in June. 41.4% believe demand will “remain the same” during the same four-month period, a decrease from 48.2% the previous month. 3.5% believe demand will decline, up from none in June. • 37.9% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, up from 32.1% in June. 62.1% of executives indicate they expect the “same” access to capital to fund business, a decrease from 67.9% last month. None expect “less” access to capital, unchanged from the previous month. • When asked, 37.9% of the executives report they expect to hire more employees over the next four months, down from 46.2% in June. 62.1% expect no change in headcount over the next four months, an increase from 50% last month. None expect to hire fewer employees, down from 3.9% in June. • 27.6% of the leadership evaluate the current U.S. economy as “excellent,” an increase from 22.2% the previous month. 72.4% of the leadership evaluate the current U.S. economy as “fair,” down from 77.8% in June. None evaluate it as “poor,” unchanged from last month. • 48.3% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, a decrease from 51.9% in June. 51.7% indicate they believe the U.S. economy will “stay the same” over the next six months, an increase from 48.2% last month. None believe economic conditions in the U.S. will worsen over the next six months, unchanged from the previous month. • In July 51.7% of respondents indicate they believe their company will increase spending on business development activities during the next six months, up from 48.2% last month. 48.3% believe there will be “no change” in business development spending, a decrease from 51.9% in June. None believe there will be a decrease in spending, unchanged from last month. July 2021 MCI-EFI Survey Comments from Industry Executive Leadership: Bank, Middle Ticket "Key is seeing equipment demand increasing, and we are optimistic about the second half of 2021. Frequently, we find we are competing against cash as often as we are another bank." Adam Warner, President, Key Equipment Finance Captive, Middle Ticket Why an MCI-EFI? Who participates in the MCI-EFI? How is the MCI-EFI designed? How may I access the MCI-EFI? The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org. |
|