Equipment leasing and finance industry confidence improves in August

Washington, D.C. – The Equipment Leasing & Finance Foundation (the Foundation) recently released the August 2020 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 48.4, an increase from the July index of 45.3.

August 2020 Survey Results:
The overall MCI-EFI is 48.4, an increase from the July index of 45.3.

•   When asked to assess their business conditions over the next four months, 24.1% of executives responding said they believe business conditions will improve over the next four months, up from 21.4% in July. 51.7% believe business conditions will remain the same over the next four months, an increase from 50% the previous month. 24.1% believe business conditions will worsen, a decrease from 28.6% in July.

•   13.8% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, down from 14.3% in July. 65.5% believe demand will “remain the same” during the same four-month time period, an increase from 64.3% the previous month. 20.7% believe demand will decline, a decrease from 21.4% in July.

•   17.2% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, up from 10.7% in July. 75.9% of executives indicate they expect the “same” access to capital to fund business, a decrease from 78.6% last month. 6.9% expect “less” access to capital, a decrease from 10.7% the previous month.

•   When asked, 13.8% of the executives report they expect to hire more employees over the next four months, up from 7.1% in July. 69% expect no change in headcount over the next four months, a decrease from 75% last month. 17.2% expect to hire fewer employees, down slightly from 17.9% the previous month.

•   None of the leadership evaluate the current U.S. economy as “excellent,” unchanged from the previous month. 48.3% of the leadership evaluate the current U.S. economy as “fair,” up from 39.3% in July. 51.7% evaluate it as “poor,” down from 60.7% last month.

•   31% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, an increase from 25.9% in July. 44.8% indicate they believe the U.S. economy will “stay the same” over the next six months, a decrease from 55.6% last month. 24.1% believe economic conditions in the U.S. will worsen over the next six months, up from 18.5% the previous month.

•    In August, 31% of respondents indicate they believe their company will increase spending on business development activities during the next six months, an increase from 21.4% last month. 48.3% believe there will be “no change” in business development spending, a decrease from 57.1% in July. 20.7% believe there will be a decrease in spending, down from 21.4% last month.

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