The Equipment Leasing and Finance Foundation releases the August 2022 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI). 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 50, an increase from the July index of 46.1.

When asked about the outlook for the future, MCI-EFI survey respondent Dave Fate, Chief Executive Officer, Stonebriar Commercial Finance, said:

“The resilience of the equipment leasing and finance industry continues to demonstrate itself during 2022. Over the decades the industry has overcome and prospered through recessions, a financial crisis, and a global health pandemic. We are all now faced with the challenges of supply chain disruption, inflation, labor shortages, and the ‘noise’ that accompanies the upcoming midterm elections in a few months. Regardless of these challenges, the industry always performs well. Speaking on behalf of Stonebriar Commercial Finance, I am happy to report that SCF is on a record pace for new business volume and profitability this year, and our portfolio continues to perform exceptionally well.”   

August 2022 Survey Results

The overall MCI-EFI is 50, an increase from the July index of 46.1.
 
• When asked to assess their business conditions over the next four months, 14.8% of executives responding said they believe business conditions will improve over the next four months, an increase from 3.7% in July. 51.9% believe business conditions will remain the same over the next four months, down from 63% the previous month. 33.3% believe business conditions will worsen, unchanged from July.

• 7.7% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, a decrease from 11.1% in July. 76.9% believe demand will “remain the same” during the same four-month time period, an increase from 55.6% the previous month. 15.4% believe demand will decline, down from 33.3% in July.

• 7.4% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, down from 11.1% in July. 85.2% of executives indicate they expect the “same” access to capital to fund business, an increase from 81.5% last month. 7.4% expect “less” access to capital, unchanged from the previous month.

• When asked, 25.9% of the executives report they expect to hire more employees over the next four months, up from 18.5% in July. 74.1% expect no change in headcount over the next four months, a decrease from 77.8% last month. None expect to hire fewer employees, down from 3.7% in July.

• None of the leadership evaluate the current U.S. economy as “excellent,” a decrease from 11.1% the previous month. 85.2% of the leadership evaluate the current U.S. economy as “fair,” up from 77.8% in July. 14.8% evaluate it as “poor,” an increase from 11.1% last month.

• 11.1% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, an increase from 7.4% in July. 51.9% indicate they believe the U.S. economy will “stay the same” over the next six months, an increase from 40.7% last month. 37% believe economic conditions in the U.S. will worsen over the next six months, a decrease from 51.9% the previous month.

• In August 29.6% of respondents indicate they believe their company will increase spending on business development activities during the next six months, up from 22.2% the previous month. 70.4% believe there will be “no change” in business development spending, down from 74.1% in July. None believe there will be a decrease in spending, down from 3.7% last month.