The October Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) came in at 53.3, relatively unchanged from the September index of 53.0, reflecting steady industry confidence despite economic, political and regulatory concerns, according to the Equipment Leasing & Finance Foundation.
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 $628 billion equipment finance sector.
When asked about the outlook for the future, MCI survey respondent Harry Kaplun, President, Frost Equipment Leasing and Finance, said, “Near term, results will continue to be strong. In the longer term, significant variables like accounting rules, depreciation rates and cost of funds will change the landscape.”
When asked to assess their business conditions over the next four months, 8.6% of executives responding said they believe business conditions will improve over the next four months, relatively unchanged from 8.8% in September. 74.3% of respondents believe business conditions will remain the same over the next four months, up from 73.5% in September. 17.1% believe business conditions will worsen, down from 17.6% the previous month.
- 20% of survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, an increase from 11.8% in September. 57.1% believe demand will “remain the same” during the same four-month time period, down from 76.5% the previous month. 22.9% believe demand will decline, up from 11.8% in September.
- 20% of executives expect more access to capital to fund equipment acquisitions over the next four months, up from 14.7% in September. 80% of survey respondents indicate they expect the “same” access to capital to fund business, a decrease from 85.3% the previous month. No survey respondents expect “less” access to capital, unchanged from September.
- When asked, 34.3% of the executives reported they expect to hire more employees over the next four months, up from 29.4% in September. 57.1% expect no change in headcount over the next four months, down from 67.6% last month. 8.6% expect fewer employees, up from 2.9% of respondents who expected fewer employees in September.
- 65.7% of the leadership evaluates the current U.S. economy as “fair,” down from 76.5% last month. 34.3% rate it as “poor,” up from 23.5% in September.
- 8.6% of survey respondents believe that U.S. economic conditions will get “better” over the next six months, up from 5.9% in September. 77.1% of survey respondents indicate they believe the U.S. economy will “stay the same” over the next six months, down from 79.4% in September. 14.3% believe economic conditions in the U.S. will worsen over the next six months, a decrease from 14.7% who believed so last month.