Equipment Finance Confidence is at Two-Year High for Second Consecutive Month

WASHINGTON, D.C. — The Equipment Leasing & Finance Foundation released the April 2014 Monthly Confidence Index for the Equipment Finance Industry. 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 65.1, remaining at the highest index level in two years for the second consecutive month.  

When asked about the outlook for the future, MCI survey respondent Thomas Jaschik, president, BB&T Equipment Finance, said, “The first quarter of 2014 had positive results with respect to new business activity, and the economy is on a positive trajectory. The conclusion of the winter of 2013-14 may be the catalyst for pent-up demand to begin to be released. This will have a positive impact on the equipment finance market throughout 2014.”
 
April 2014 Survey Results:
The overall MCI-EFI is 65.1, unchanged from the March index.

• When asked to assess business conditions over the next four months, 37 percent of executives responding said they believe business conditions will improve over the next four months, up from 31.4 percent in March. Sixty percent of respondents believe business conditions will remain the same over the next four months, down from 65.7 percent in March. 2.9 percent believe business conditions will worsen, unchanged from the previous month.
• 37 percent of survey respondents believe demand for leases and loans to fund capital expenditures will increase over the next four months, up from 31.4 percent in March. 60 percent believe demand will “remain the same” during the same four-month time period, down from 62.9 percent the previous month. 2.9 percent believe demand will decline, down from 5.7 percent who believed so in March.
• 28.6 percent of executives expect more access to capital to fund equipment acquisitions over the next four months, a decrease from 31.4 percent in March. 71.4 percent of survey respondents indicate they expect the “same” access to capital to fund business, up from 68.6 percent in March. No one expects “less” access to capital, unchanged from the previous month.
• When asked, 37 percent of the executives reported they expect to hire more employees over the next four months, a decrease from 40 percent in March. 60 percent expect no change in headcount over the next four months, unchanged from last month. 2.9 percent expect fewer employees, up from no one who expected fewer employees in March.
• 2.9 percent of the leadership evaluates the U.S. economy as “excellent,” down from 5.7 percent last month. 91.4 percent of the leadership evaluates the U.S. economy as “fair,” up from 88.6 percent last month.   5.7 percent rate it as “poor,” unchanged from March.
• 34.3 percent of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, an increase from 31.4 percent who believed so in March. 62.9 percent of survey respondents indicate they believe the U.S. economy will “stay the same” over the next six months, a decrease from 68.6 percent in March. 2.9 percent believes economic conditions in the U.S. will worsen over the next six months, an increase from no one who believed so last month.
• In April, 40 percent of respondents indicated they believe their company will increase spending on business development activities during the next six months, a decrease from 45.7 percent in March. 60 percent believe there will be “no change” in business development spending, an increase from 54.3 percent last month. No one believes there will be a decrease in spending, unchanged from last month.

Survey results are posted on the foundation website at http://www.leasefoundation.org/IndRsrcs/MCI/. Survey respondent demographics and additional information about the MCI are also available at the link above.