The November confidence index is steadyThe US Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) remained relatively unchanged for November, to sit at 59.9, suggesting confidence in the sector remains stable.
The October MCI-EFI was slightly higher at 60.1 while September was also 59.9. The index has been reasonably steady since June when it was 58.2, but is still 10 points short of its high in January of 69.6.
That said, it is much healthier than it was in April when it fell to 41.9 following the US Administration’s announcement of new tariffs on imports.
The MCI-EFI, produced by the Equipment Leasing & Finance Foundation (ELFF), provides a qualitative assessment from key executives in the USD1.3 trillion equipment finance industry.
The US equipment finance confidence index remains stable
When assessing business conditions for the next four months, 25% of survey respondents believe business conditions will improve (down from 37.5% in October). The majority (62.5%) believe they will remain the same (up from 54.2% the previous month), while 12.5% believe business conditions will worsen (up from 8.3% in October).
Asked to evaluate the US economy, 95.8% assess it as “fair” (it sat at 100% last month), with 4.2% believing the economy is excellent, an improvement of zero percent in October.
Evaluating the US economic outlook for the following six months, 37.5% of respondents believe conditions will improve, a solid increase from the 30.4% in October, while 20.8% believe economic conditions will worsen, down from 30.4% last month.
Survey participant Jim DeFrank, EVP and chief operating office with Isuzu Finance of America says: “We’re anticipating a nice pickup in Q4 as lower rates, pent-up demand, and 2025’s depreciation advantages drive renewed momentum”.
Jeffry Elliott, CLFP, CEO of Elevex Capital and Equipment Leasing & Finance Association treasurer says the equipment finance industry is “well positioned” for either a downturn of economic boom.
“The sector, by nature, finances equipment that is new during boom times and used during downturns, so we have a game plan in either situation,” Elliott adds.
“Equipment finance industry participants that have strong asset management capabilities will perform better in the downturns versus others that do not invest in that capability and talent.”
More than 45% of survey respondents (45.8%) work in businesses valued at higher than USD1 billion; 25% each in businesses worth between USD50-250 million and USD250 million to USD 1 billion. The remaining 4.2% are in companies valued at under USD50 million.