The Equipment Leasing & Finance Foundation (the Foundation) recently released the September 2014 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI). 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 60.2, an increase from the August index of 58.9.
MCI-EFI survey respondent Valerie Hayes Jester, president, Brandywine Capital Associates Inc., said, “We are experiencing stronger demand than in the past several months, which bodes well for a strong fourth quarter. There is still concern for yield erosion, but we look forward to concluding the year on a positive trend.”
The September 2014 survey results include:
• When asked to assess their business conditions over the next four months, 36.4% of executives said they believe business conditions will improve over the next four months, up from 18.2% in August. 60.6% of respondents believe business conditions will remain the same over the next four months, down from 78.8% in August. 3% believe business conditions will worsen, unchanged from the previous month.
• 30.3% of survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, up from 21.2% in August. 66.7% believe demand will remain the same during the same four-month time period, down from 75.8% the previous month. 3% believe demand will decline, unchanged from August.
• 15.2% of executives expect more access to capital to fund equipment acquisitions over the next four months, unchanged from August. 84.8% of survey respondents indicate they expect the same access to capital to fund business, and none of them expects less access to capital, both numbers also unchanged from the previous month.
• When asked, 30.3% of the executives reported they expect to hire more employees over the next four months, a decrease from 33.3% in August. 60.6% expect no change in headcount over the next four months, up from 57.6% last month. 9.1% expect fewer employees, unchanged from August.
• 6.1% of the leadership evaluates the current U.S. economy as “excellent,” unchanged from last month. 87.9% of the leadership evaluates the current U.S. economy as “fair,” and 6.1% rate it as “poor,” both also unchanged from August.
• 27.3% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, a decrease from 30.3% who believed so in August. 66.7% of survey respondents indicate they believe the U.S. economy will “stay the same” over the next six months, unchanged from August. 6.1% believe economic conditions in the U.S. will worsen over the next six months, up from 3% who believed so last month.
• In September, 15.2% of respondents indicate they believe their company will increase spending on business development activities during the next six months, a decrease from 21.2% in August. 84.8% believe there will be “no change” in business development spending, an increase from 78.8% last month. None believe there will be a decrease in spending, unchanged from last month.