Equipment finance industry confidence rebounds from tariff pressures
The Equipment Leasing & Finance Foundation announces that overall, confidence in the equipment finance market is 58.2, a return to historically more positive levels after dramatic lows in April and May.
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.
“As companies are getting a better feel for where tariffs will land, it’s very plausible we’ll see pent-up demand begin to release, backlogged or postponed purchases resurface, and a shift in financing behavior. Leasing in particular could spike, as companies look to preserve cash while still upgrading assets,” says Jim DeFrank, executive vice president and chief operating officer, Isuzu Finance of America, Inc.
June 2025 survey results
The overall MCI-EFI is 58.2, up from the May index of 44.5.
- Business conditions - When asked to assess their business conditions over the next four months, 29.6 percent of the executives responding said they believe business conditions will improve over the next four months, an increase from 4 percent in May. 59.3 percent believe business conditions will remain the same over the next four months, up from 52 percent the previous month while 11.1 percent believe business conditions will worsen, down from 44 percent in May.
- Capex demand – Almost 30 percent (29.6 percent) of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, up from 8 percent in May and 55.6 percent believe demand will remain the same during the same four-month period, up from 44 percent the previous month. Only 14.8 percent believe demand will decline, a decrease from 48 percent in May.
- Access to capital – Almost 20 percent (18.5 percent) of the respondents expect more access to capital to fund equipment acquisitions over the next four months, up from 4.2 percent in May and 81.5 percent of executives indicate they expect the same access to capital to fund business, down from 95.8 percent the previous month. None expect less access to capital, unchanged from May.
- Employment – When asked, 33.3 percent of the executives report they expect to hire more employees over the next four months, an increase from 24 percent in May; 66.7 percent expect no change in headcount over the next four months, down from 72 percent last month. None expect to hire fewer employees, down from 4 percent in May.
- U.S. economy – None of the leadership evaluate the current U.S. economy as excellent, unchanged from May and 96.3 percent evaluate the economy as fair, up from 84 percent the previous month. 3.7 percent evaluate it as poor, down from 16 percent in May.
- Economic outlook – Nearly a third (29.6 percent) of the survey respondents believe that U.S. economic conditions will get better over the next six months, up from 12 percent in May and 51.9 percent indicate they believe the U.S. economy will stay the same over the next six months, up from 44 percent last month. Just 18.5 percent believe economic conditions in the U.S. will worsen over the next six months, a decrease from 44 percent the previous month.
- Business development spending – In June, 18.5 percent of respondents indicate they believe their company will increase spending on business development activities during the next six months, down from 32 percent the previous month. A majority (77.8 percent) believe there will be no change in business development spending, an increase from 64 percent in May. 3.7 percent believe there will be a decrease in spending, relatively unchanged from last month.
June 2025 MCI-EFI survey comments from industry executive leadership
Bank, Small Ticket
“As tariff talks continue to ping pong back and forth, one thing is clear: businesses continue to grow and demand financing. Tired of the "wait and see" approach, many are pulling the trigger and looking forward.” -- Charles Jones, senior vice president, 1st Equipment Finance, Inc.
“Fundamentals in the market remain positive. 2025 has been a good year for many equipment finance companies and the possibility for incremental improvement is visible. I expect to realize a solid growth year in 2025.” -- David Normandin, president and chief executive officer, Wintrust Specialty Finance
Independent, Middle Ticket
“Tariffs and subsequent economic pressures related to supply chain issues and inflation will slow down equipment purchases. However, a slowdown may limit competitive capital in the equipment finance space and allow for more opportunities at higher margins for independent lessors.” -- Jeffry Elliott, CEO, Elevex Capital
Survey results are posted at https://www.leasefoundation.org/industry-resources/monthly-confidence-index/.
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