Washington, D.C. (Nov. 14, 2019)—The Equipment Leasing & Finance Foundation has released the November 2019 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 $900 billion equipment finance sector. Overall, confidence in the equipment finance market is 54.9, an increase from the October index of 51.4.
When asked about the outlook for the future, MCI-EFI survey respondent Quentin Cote, CLFP, president, Mintaka Financial LLC, said, “It appears we have absorbed the headwind of the trade wars. Consumers still seem to be pulling the economy forward.”
November 2019 Survey Results:
The overall MCI-EFI is 54.9, an increase from 51.4 in October.
When asked to assess their business conditions over the next 4 months, 13.3% of executives responding said they believe business conditions will improve over the next 4 months, up from 9.7% in October; 73.3% of respondents believe business conditions will remain the same over the next 4 months, an increase from 71% the previous month; 13.3% believe business conditions will worsen, down from 19.4% in October.
- 13.3% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next 4 months, unchanged from October; 63.3% believe demand will “remain the same” during the same 4-month time period, a decrease from 73.3% the previous month; 23.3% believe demand will decline, down from 13.3% in October.
- 20% of the respondents expect more access to capital to fund equipment acquisitions over the next 4 months, up from 16.7% in October; 80% of executives indicate they expect the “same” access to capital to fund business, unchanged from last month; None expect “less” access to capital, a decrease from 3.3% in October.
- When asked, 26.7% of the executives report they expect to hire more employees over the next 4 months, an increase from 16.1% in October; 73.3% expect no change in headcount over the next 4 months, an increase from 71% last month; None expect to hire fewer employees, down from 12.9% the previous month.
- 16.7% of the leadership evaluate the current United States’ economy as “excellent,” down from 19.4% the previous month; 83.3% of the leadership evaluate the current U.S. economy as “fair,” up from 80.7% in October; None evaluate it as “poor,” unchanged from last month.
- 10% of the survey respondents believe that U.S. economic conditions will get “better” over the next 6 months, up from 3.2% in October; 76.7% of survey respondents indicate they believe the U.S. economy will “stay the same” over the next 6 months, an increase from 58.1% the previous month; 13.3% believe economic conditions in the U.S. will worsen over the next 6 months, a decrease from 38.7% in October.
- In November, 30% of respondents indicate they believe their company will increase spending on business development activities during the next 6 months, an increase from 25.8% last month; 63.3% believe there will be “no change” in business development spending, a decrease from 71% in October; 6.7% believe there will be a decrease in spending, an increase from 3.2% last month.
November 2019 MCI-EFI Survey Comments from Industry Executive Leadership:
Bank, Small Ticket
“Wintrust Specialty Finance is optimistic about the continued volume and credit quality we are experiencing.” David Normandin, CLFP, president and chief executive officer, Wintrust Specialty Finance
Bank, Middle Ticket
“We do not expect significant investment in the agriculture vertical until trade policy issues are resolved.” Michael Romanowski, president, Farm Credit Leasing