The Equipment Leasing & Finance Foundation released the September 2023 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 $1 trillion sector. Overall, confidence in the equipment finance market is 50.3, steady with the August index of 50.4.

“Overall, there appears to be good momentum around capital investment, whether driven by infrastructure initiatives, emerging technologies or onshoring,” Jonathan Albin, chief operating officer of Nexseer Capital, said. “Barring the emergence of a severe economic threat, I believe this momentum will continue.”

September 2023 Survey Results:

The overall MCI-EFI is 50.3, steady with the August index of 50.4.

• 3% of executive respondents said they believe business conditions will improve over the next four months, an increase from 3.6% in August. 75.9% believe business conditions will remain the same over the next four months, down from 89.3% in August. 13.8% believe business conditions will worsen, an increase from 7.1% in August.
• 3% of survey respondents believe demand for leases and loans to fund capital expenditure will increase over the next four months, relatively unchanged from 10.7% last month. 79.3% believe demand will “remain the same” during the same four-month time period, an increase from 78.6% in August. 10.3% believe demand will decline, also relatively unchanged from 10.7% in August.
• 8% of respondents expect more access to capital to fund equipment acquisitions over the next four months, up from 7.1% in August. 72.4% of executives indicate they expect the “same” access to capital to fund business, down from 78.6% in August. 13.8% expect “less” access to capital, down from 14.3%.
• 7% of the executives report they expect to hire more employees over the next four months, a decrease from 22.2% in August. 72.4% expect no change in headcount over the next four months, up from 70.4% last month. 6.9% expect to hire fewer employees, down from 7.4% in August.
• None of the leadership evaluate the current U.S. economy as “excellent,” down from 3.6% in August. 89.7% of the leadership evaluate the current U.S. economy as “fair,” up from 85.7% in August. 10.3% evaluate it as “poor,” relatively unchanged from 10.7% last month.
• 9% of the survey respondents believe that U.S. economic conditions will get better over the next six months, a decrease from 10.7% in August. 62.1% indicate they believe the U.S. economy will stay the same over the next six months, an increase from 60.7% last month. 31% believe economic conditions in the U.S. will worsen over the next six months, an increase from 28.6% in August.
• 1% of respondents indicate they believe their company will increase spending on business development activities during the next six months, down from 25% in August. 69% believe there will be “no change” in business development spending, up from 67.9% in August. 6.9% believe there will be a decrease in spending, relatively unchanged from 7.1% last month.

September 2023 MCI-EFI Survey Comments from Industry Executive Leadership:

Bank, Small Ticket

“Interest rates have hopefully stabilized. Demand should increase to account for year-end spending,” Charles Jones, senior vice president of 1^st Equipment Finance (FNCB Bank), said.

Independent, Small Ticket

“Inflation and the economy will improve when we return to energy independence,” James D. Jenks, CEO of Global Finance and Leasing Services, said.