The Equipment Leasing & Finance Foundation has released the November 2014 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI), which indicates that confidence in the equipment finance market is at its highest level since May. The index reports a qualitative assessment of the prevailing business conditions and expectations for the future as reported by key executives from the $903 billion equipment finance sector. With mid-term elections over and gas prices and unemployment statistics decreasing, one survey respondent said there has been an increased demand for capital equipment purchases and financing. "Another important note is that the equipment being requisitioned appears to be associated with business expansion and not just replacement of older assets," the respondent said.
Read more for highlights from the survey.
November 2014 Survey Results
- The overall MCI-EFI is 64.2, an increase from the October index of 60.4.
- When asked to assess their business conditions over the next four months, 27.3% of executives responding said they believe business conditions will improve over the next four months, up from 23% in October. 69.7% of respondents believe business conditions will remain the same over the next four months, down from 74% in October. 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 25.7% in October. 66.7% believe demand will “remain the same” during the same four-month time period, down from 71.4% the previous month. 3% believe demand will decline, unchanged from October.
- 21.2% of executives expect more access to capital to fund equipment acquisitions over the next four months, up from 11.4% in October. 78.8% of survey respondents indicate they expect the “same” access to capital to fund business, down from 88.6% in October. None expect “less” access to capital, unchanged from the previous month.
- When asked, 45.4% of the executives reported they expect to hire more employees over the next four months, an increase from 40% in October. 48.5% expect no change in headcount over the next four months, unchanged from last month. 6.1% expect fewer employees, down from 11.4% in October.
- 3% of the leadership evaluate the current U.S. economy as “excellent,” unchanged from last month. 97% of the leadership evaluate the current U.S. economy as “fair,” up from 94.3% in October. None rate it as “poor,” down from 3% the previous month. .
- 42.4% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, an increase from 28.6% who believed so in October. 54.6% of survey respondents indicate they believe the U.S. economy will “stay the same” over the next six months, down from 68.6% in October. 3% believe economic conditions in the U.S. will worsen over the next six months, unchanged from last month.
- In November, 42.4% of respondents indicate they believe their company will increase spending on business development activities during the next six months, an increase from 34.3% in October. 54.6% believe there will be “no change” in business development spending, a decrease from 63% last month. 3% believe there will be a decrease in spending, unchanged from last month.
