Equipment Leasing & Finance Foundation

Equipment Lease Finance Industry Confidence Improves in November

The Equipment Leasing & Finance Foundation (the Foundation) releases the November 2013 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) today. Designed to collect leadership data, the index reports a qualitative assessment of both the prevailing business conditions and expectations for the future as reported by key executives from the $827 billion equipment finance sector. Overall, confidence in the equipment finance market is 56.9, an increase from the October index of 54.0, demonstrating an overall steady industry outlook despite continuing concerns about the U.S. economy and the negative impact of federal government fiscal policies. 

When asked about the outlook for the future, MCI survey respondent Russell Nelson, President, CoBank Farm Credit Leasing, said, “Continued stability and modest growth in the economy combined with increased strength in customer balance sheets, low interest rates, and pent-up demand for replacement/new assets for 2014 and beyond will generate double digit growth for equipment and facility financing over the next 18 to 24 months.” 

November 2013 survey results

When asked to assess their business conditions over the next four months:

  • 17.2% of executives responding said business conditions will improve, up from 11% in October
  • 79.3% believe business conditions will remain the same, up from 74% in October
  • 3.4% believe business conditions will worsen, down from 15% who believed so the previous month
  • 13.8% believe demand for leases and loans to fund capital expenditures (capex) will increase, up from 7.4% in October
  • 75.9% believe demand will “remain the same”, down from 77.8% the previous month
  • 10.3% believe demand will decline, down from 15% who believed so in October
  • 24% expect more access to capital to fund equipment acquisitions, up from 18.5% in October
  • 72.4% expect the “same” access to capital to fund business, down from 81.8% in October
  • 3.4% expect “less” access to capital, up from no one who expected less access in October
  • 27.6% expect to hire more employees, a decrease from 33.3% in October
  • 65.5% expect no change in headcount, down slightly from 66.7% last month
  • 6.9% expect fewer employees, up from no one who expected fewer employees in October
  • 6.9% evaluates the current U.S. economy as “excellent”, up from no one who believed so last month
  • 75.9% evaluates the current U.S. economy as “fair,” down from 85.2% last month
  • 17.2 % rate it as “poor,” up from 15% in October

When asked to assess conditions over the next six months:

  • 17.2% believe that U.S. economic conditions will get “better”, an increase from no one who believed so in October
  • 72.4% believe the U.S. economy will “stay the same”, a decrease from 89% in October
  • 10.3% believe economic conditions in the U.S. will worsen over the next six months, relatively unchanged from last month
  • 34.5% believe their company will increase spending on business development activities, a slight increase from 33.3% in October
  • 65.5% believe there will be “no change” in business development spending, also a slight increase from 66.7% last month
  • No one believes there will be a decrease in spending, unchanged from October