In Austria, equipment leasing and overseas new business are up,
but lessors are under pressure in the face of rising funding
costs
Increasingly, Austrian businesses and citizens are selecting
environmentally friendly technologies in cars, real estate and
energy facilities – and Rudolf Fric, president of the Association
of Austrian Leasing Companies (VÖL), told Leasing Life
last month that leasing is benefiting from this growing ecological
awareness.
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The “green” trend in 2007 contributed to Austrian leasing
companies’ domestic new business rising by 8.3 per cent to €6.6bn.
Fric also said the value of leasing is increasingly being
recognised by banks.
Despite the slump in the financial markets, VÖL reported there
was a 4.7 per cent rise in the leasing portfolio to €22.6bn, of
which more than half comprised real estate leasing. Vehicle leasing
accounted for a third and the remainder was comprised of equipment
leasing.
Although there was a fall in new vehicle registrations in 2007,
vehicle leasing rose by 2.4 per cent to €3.5bn. This was largely
because of high growth rates in HGVs – two-thirds of transport
vehicles are financed through leasing. Overall, leasing’s volume
has more than doubled over the past 10 years, with one in every
three new vehicles now being leased.
Fric observed: “More and more companies are rethinking their
strategy and choosing low-emission cars. In times of increasing
fuel prices, however, adjustments like these are primarily
economically motivated, with environmental reasons being a second
priority.”
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By GlobalDataEquipment leasing recorded the highest growth rates in 2007,
much to the astonishment of Fric and the industry, rising by 18.2
per cent to €1.7bn. Leasing companies came to the fore in financing
ecologically friendly energy power plants. By way of example, a
third of wind generators are financed by leasing. Further potential
areas of growth are photovoltaic facilities and biomass power
plants.
Despite the strong competition from funds for real estate
financing, leasing achieved growth of 13.5 per cent to €1.4bn.
According to VÖL, this sector is seeing a shift away from merely
financing to the complete execution of individual construction
projects.
Leasing experts’ environmental knowledge is proving invaluable,
with the increasing focus on low-energy buildings and
environmentally friendly construction. This is expected to
intensify in 2008, with new leasing products enabling house owners
to cut their energy consumption and related expenses by 15 to 20
per cent over time.
The foreign subsidiaries of Austrian leasing companies had
another very successful year in 2007. Although cross-border
activity accounted for just a small share (€1.3bn) of new business
generated abroad, total overseas new business increased by a
significant 38 per cent to €15.2bn.
Fric said Eastern Europe was once again a success story and
attributed this to Austrian lessors’ investment in the region in
the 1990s, which is now reaping considerable business benefits.
Given its geographical location, Austria was the obvious pioneer in
identifying new business opportunities in the emerging markets of
Eastern Europe and this region generated €13.7bn of new business
for Austrian lessors last year.
