The US leasing market is expected to return to pre-recession levels this year and exceed them in 2013, according the US industry research body, the Equipment Leasing & Finance Foundation (ELFF).
The study by ELFF, the research arm of the Equipment Leasing & Finance Association (ELFA), has estimated total business volume for the equipment finance market will total $725bn in 2012 and projected it will increase to $740bn next year.
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In 2014, the market size is projected to grow to $778 billion.
Business volume in 2011 for the equipment leasing industry was $628bn and the 15% growth represents a business volume on a par with levels before the global financial crisis took affect in 2009.
This information comes from the forthcoming US Equipment Finance Market Study 2012-2013, conducted by IHS Global Insight, and was announced at ELFA’s annual convention this week.
The study also projected $1.3tn will be invested in plant, equipment and software in 2013 meaning the $740bn estimated for the equipment finance market represents a 42% penetration into investment expenditure. The research also predicted 72% of companies will use some form of financing over the course of the year.
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By GlobalDataThe share of leasing volume doubled from 2007 to 2012 for companies with sales between $25m and $100m, while cash as a method of purchasing declined for large companies in the same period.
The full study will be released in November.
The annual convention was also an occasion for the ELFA board to make a policy statement on comprehensive tax reform. Among the principles suggested to inform the ongoing discussion in the US Congress were the provision of a level playing field for lessors and other finance providers, and the promotion a more competitive international tax system.
The full policy statement is available on the ELFA website.
Meanwhile, ELFA’s monthly confidence index for October is steady at 53.3, up slightly from the September index of 53.0. The index is calculated on the basis of a survey of large-ticket, middle-market and small-ticket banks, independents and captive equipment finance companies asked to assess prevailing business conditions and expectations for the future.
