April’s equipment leasing origination volumes for the European asset finance and leasing sector fell to 45% of the Q1 average for 2020, according to the Acquis Index.
Acquis Insurance Management, an independent provider of asset finance insurance in 13 European countries and publisher of the Acquis Index, said restaurant equipment suffered the biggest impact from the Covid-19 lockdowns, with lease originations for restaurant equipment falling to 18% of Q1 volumes during April.
Meanwhile, computer equipment fared much better, managing to maintain 57% of Q1’s volumes, possibly a result of businesses investing in the infrastructure required to support home working, according to Acquis data for April.
The outlook for May continues this downward trend with anticipated volumes falling to around 30% of Q1 volumes, the insurer said.
Acquis said that while the data highlights the significant short-term impact of the coronavirus crisis, the picture varies regionally as certain European nations adopted different lockdown policies.
For example, the Netherlands (home of Acquis’ European headquarters) has fared slightly better, achieving 49% of pre-Covid volumes in April compared to 39% in France.
Acquis said its data is built on more than 10 years’ experience providing insurance programmes for equipment leasing companies.
The company said it is planning to publish European business volume origination data on a monthly basis, “to share visibility of the trends we are witnessing in equipment leasing, and assist in monitoring developments in the wider leasing industry as the economy is unlocked and the industry begins to recover.
Acquis said its volumes data is made up of mostly small-ticket equipment with an average ticket size of €12,000.
Computer/office equipment made up 58% of the volumes, 15% retail and 12% manufacturing, with the remainder consisting of construction, material handling, medical and other equipment types, the insurer said.
James Rudolf, chief commercial officer for Acquis, said: “The immediate impact of the Covid-19 crisis reflected in these figures won’t be surprising to anyone in the industry. While we don’t know exactly how long the impact will last, nor whether there will be a V-shaped bounce back or a longer-term U-shaped dip, we do know that leasing is well-positioned to play its part in the economic recovery.
“Traditional leasing products remain very attractive both from a risk perspective, where funders are financing a real asset with value, as well as a customer perspective, with leasing taking the pressure off working capital and improving cash flow.
“Thanks to the strength and depth of our European client base we are already witnessing certain sections of the European market begin their journeys to recovery.”