While the German leasing industry has
not yet seen definite signs of the market-wide consolidation that
many commentators anticipated coming into 2010, an alarming set of
first-quarter results have made the outlook for the rest of the
year considerably bleaker.

In a development that German leasing
association BDL’s president Martin Mudersbach called “not at all
satisfactory”, new business across the association’s members fell
11% year-on-year in the three months leading up to 31 March

While the rate of inter-annual decline is
lower than the 18.1% recorded for the first quarter of 2009, it
stands in stark contrast to the 11% increase in new business
recorded by UK association the FLA between March 2009 and March
2010. The UK figure represents the country’s first year-on-year
growth since September 2008.

Overall, German leasing business fell
22.6% in 2009 to reach €42bn, the highest decline registered since
records began.

According to Mudersbach, machinery
leasing was “disproportionately” affected by the first-quarter
drop, falling 26% year on year. Passenger car leasing dropped 10%,
by contrast, while commercial vehicle business fell 16%.

The machinery result is particularly
worrying given the connection between BDL members and the German
industrial sector – market leader Deutsche Leasing, for example,
conducts most of its business through vendor programmes with
machinery manufacturers.

Despite recent bad news, Mudersbach said
that there had been “no definite change” observed by the
association in the composition of the leasing market, with BDL
members managing to meet “immense” regulatory requirements well so

He conceded that “a few” companies had
been forced out of the market by a combination of new regulations
(see ‘Paradise lost’, January
) and refinancing issues , while others had been wound
up due to their founding owners retiring without leaving succession

For the majority that remain, the BDL has
issued further checklists and brochures for lessors, aimed at
preparing them to meet the risk planning requirements of German