Equipment finance industry confidence dips again in March
Overall, confidence in the equipment finance market is 58.1, down from the February index of 66.9, and the lowest index since July 2024.
The Equipment Leasing & Finance Foundation released the March 2025 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) March 20, 205. The index reports a qualitative assessment of both the prevailing business conditions and future expectations as reported by key executives from the $1.3 trillion equipment finance sector.
When asked about the outlook for the future, MCI-EFI survey respondent Donna Yanuzzi, executive vice president and head of equipment finance at 1st Equipment Finance, Inc., said, “Weeding through the noise, the Trump administration appears to be pro-business and regulatory realistic. This combination should drive investment and growth. However, the concerns of tariffs may impact business growth in some fashion. Now, more than ever, strategic planning will be key in navigating the opportunities and risks ahead.”
March 2025 survey results:
The overall MCI-EFI is 58.1, down from the February index of 66.9.
- Business conditions - When asked to assess their business conditions over the next four months, 28.6 percent of the executives responding said they believe business conditions will improve over the next four months, a decrease from 53.6 percent in February while 53.6 percent believe business conditions will remain the same over the next four months, up from 35.7 percent the previous month. Just 17.9 percent believe business conditions will worsen, up from 10.7 percent in February.
- Capex demand – Nearly a third -- 32.1 percent -- of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, down from 46.4 percent in February. Almost half -- 42.9 percent -- believe demand will remain the same during the same four-month period, down from 50 percent the previous month; and 25 percent believe demand will decline, an increase from 3.6 percent in February.
- Access to capital – Just 21.4 percent of the respondents expect more access to capital to fund equipment acquisitions over the next four months, down from 25 percent in February, while 75 percent of executives indicate they expect the same access to capital to fund business, unchanged from the previous month. Only 3.6 percent expect less access to capital, up from none in February.
- Employment - When asked, 32.1 percent of the executives report they expect to hire more employees over the next four months, a decrease from 35.7 percent in February and 67.9 percent expect no change in headcount over the next four months, down from 64.3 percent last month. None expect to hire fewer employees, unchanged from February.
- U.S. economy – Only 3.6 percent of the leadership evaluate the current U.S. economy as excellent; 92.9 percent evaluate the economy as fair, and 3.6 percent evaluate it as poor, all unchanged from last month.
- Economic outlook – Nearly a third -- 32.1 percent -- of the survey respondents believe that U.S. economic conditions will get better over the next six months, down from 48.2 percent in February and 39.3 percent indicate they believe the U.S. economy will stay the same over the next six months, down from 40.7 percent last month. More tha a quarter -- 28.6 percent -- believe economic conditions in the U.S. will worsen over the next six months, an increase from 11.1 percent the previous month.
- Business development spending – In March, 35.7 percent of respondents indicate they believe their company will increase spending on business development activities during the next six months, down from 39.3 percent the previous month. 64.3 percent believe there will be no change in business development spending, an increase from 60.7 percent in February. None believe there will be a decrease in spending, unchanged from last month.
March 2025 MCI-EFI survey comments from industry executive leadership:
Captive, Small Ticket
“If imported equipment becomes more expensive, businesses may turn to local suppliers, and with capital expenditures rising, finance and leasing could become more attractive.” -- Jim DeFrank, executive vice president and chief operating officer, Isuzu Finance of America, Inc.
Independent, Small Ticket
“We remain cautiously optimistic that the steady demand we are seeing will continue throughout the spring along with maintaining stable portfolio performance. The rapid pace and breadth of the changes by the new administration do cause us some concerns as to how those will affect consumer confidence and spending, labor markets, and overall GDP growth.” -- Daryn Lecy, chief operating officer, Oakmont Capital Services
“Keeping inflation down is very important for an economic recovery.” -- James D. Jenks, CEO, Global Finance and Leasing Services, LLC
Independent, Large Ticket
“It's hard to form clear opinions right now, but I am optimistic about the resiliency of the economy overall.” -- Jonathan Albin, chief operating officer, Nexseer Capital
Survey results are posted on the Foundation website, https://www.leasefoundation.org/industry-resources/monthly-confidence-index/. Details about the MCI, including who participates, how it’s designed, and the survey respondent demographics are also available at the link above.
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