According to the Equipment Leasing & Finance Foundation's October report, the $725 billion equipment finance market is down 54.0, a decline from the September index of 61.3.
MCI survey respondent Valerie Hayes Jester, president, Brandywine Capital Associates Inc., said, “The future of the industry remains optimistic. My larger concern is for the future of our country and the inability of our government to lead. Ultimately, the stalemate in Washington will have a negative effect on our economy in the short run. My hope is that we can get small business back on track and investing again in equipment in 2014.”
October 2013 survey results:
- When asked to assess their business conditions over the next four months, 11% of executives responding said they believe business conditions will improve over the next four months, down from 30.3% in September. 74% of respondents believe business conditions will remain the same over the next four months, up from 66.7% in September. 15% believe business conditions will worsen, up from 3% who believed so the previous month.
- 7.4% of survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, down from 33.3% in September. 77.8% believe demand will “remain the same” during the same four-month time period, up from 63.6% the previous month. 15% believe demand will decline, up from 3% who believed so in September.
- 18.5% of executives expect more access to capital to fund equipment acquisitions over the next four months, unchanged from September. 81.8% of survey respondents indicate they expect the “same” access to capital to fund business, and no one expects “less” access to capital, both also unchanged from September.
- When asked, 33.3% of the executives reported they expect to hire more employees over the next four months, a decrease from 36.4% in September. 66.7% expect no change in headcount over the next four months, up from 60.6% last month. No one expects fewer employees, down from 3% of respondents who expected fewer employees in September.
- 85.2% of the leadership evaluates the current U.S. economy as “fair,” down from 90.9% last month. 15% rate it as “poor,” up from 9% in September.
- None of the of survey respondents believe that U.S. economic conditions will get “better” over the next six months, a decrease from 18.2% in September. 89% of survey respondents indicate they believe the U.S. economy will “stay the same” over the next six months, an increase from 79% in September. 11% believe economic conditions in the U.S. will worsen over the next six months, up from 3% last month.
- In October, 33.3% of respondents indicate they believe their company will increase spending on business development activities during the next six months, an increase from 30.3% in September. 66.7% believe there will be “no change” in business development spending, unchanged from last month. No one believes there will be a decrease in spending, down from 3% who believed so in September.
October 2013 MCI survey comments:
Bank, Small Ticket
“Our industry is poised to help fuel economic expansion. Unfortunately, the circus in the U.S. Congress is holding back, if not threatening, the recovery we have prepared for.” Paul Menzel, President & CEO, Financial Pacific Leasing, LLC.
Bank, Middle Ticket
“With the continuing dysfunction in Washington due to the lack of any effective leadership, the short-term outlook for the equipment finance industry is very clouded. Demand for financing will likely continue with the see-saw pattern we have experienced over the last several years,” Thomas Jaschik, President, BB&T Equipment Finance.
Bank, Middle Ticket
“The dysfunction in D.C. is now at a critical stage. If the government doesn’t learn how to deal with these issues in a more timely manner, we will lose the confidence gained over the last year causing further weakness in the economy,” Kenneth Collins, CEO, Susquehanna Commercial Finance, Inc.