Equipment finance industry confidence steady in January

The Equipment Leasing & Finance Foundation (the Foundation) releases the January 2022 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) today. 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. Overall, confidence in the equipment finance market is 63.9, unchanged from the December index.

When asked about the outlook for the future, MCI-EFI survey respondent Jim DeFrank, EVP and Chief Operating Officer, Isuzu Finance of America, Inc., said, “It’s all about supply chain right now. There is demand for equipment, but manufactures are having a hard time satisfying the demand due to parts shortages, workforce issues, etc. Once the supply can match demand, we will see a nice increase in finance and leasing volumes. Hopefully, by the second half of 2022.”

January 2022 highlights include:

• •When asked to assess their business conditions over the next four months, 25.9% of executives responding said they believe business conditions will improve over the next four months, a decrease from 34.6% in December. 70.4% believe business conditions will remain the same over the next four months, up from 61.5% the previous month. 3.7% believe business conditions will worsen, unchanged from December.
• 25.9% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, down from 26.9% in December. 70.4% believe demand will “remain the same” during the same four-month time period, a decrease from 73.1% the previous month. 3.7% believe demand will decline, up from none in December.
• 21.4% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, up from 19.2% in December. 78.6% of executives indicate they expect the “same” access to capital to fund business, a decrease from 80.8% last month. None expect “less” access to capital, unchanged from the previous month. 
• 14.8% of the leadership evaluate the current U.S. economy as “excellent,” a decrease from 19.2% the previous month. 81.5% of the leadership evaluate the current U.S. economy as “fair,” up from 76.9% in December. 3.7% evaluate it as “poor,” unchanged from last month.
• 29.6% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, an increase from 19.2% in December. 63% indicate they believe the U.S. economy will “stay the same” over the next six months, an increase from 61.5% last month. 7.4% believe economic conditions in the U.S. will worsen over the next six months, a decrease from 19.2% the previous month.