Equipment finance booms, projected for growth
After returning to nearly pre-recession levels in 2012, says the Equipment Leasing & Finance Foundation, the U.S. private and public sectors are on pace to finance more than $742 billion in equipment acquisitions in 2013, says a forecast from the Foundation.
That number would represent almost $20 billion in additional equipment financing over the current projections for 2012, which is on track to hit the $725 billion mark.
The ELLF’s Equipment Finance Market Study 2012-2013 shows that the equipment finance sector has emerged from the recent recession as a strong entity within the U.S. economy, with “finance volumes at an all-time high,” says an announcement from the ELLF, resulting from enormous growth in equipment investment and good interest rates.
“Equipment financing plays a significant role in helping businesses acquire the equipment they need,” says William G. Sutton, president of the Equipment Leasing & Finance Foundation. “The equipment finance sector not only contributes to businesses’ success, but to U.S. economic growth, manufacturing and jobs.”
The report also says that nearly 30 percent of companies surveyed said they planned to increase their equipment investments in the next year, and that 72 percent of companies who acquire new equipment use some type of financing, either from a loan, line of credit or lease.
Companies with less than $1 million in revenues use financing in 49 percent of their equipment acquisitions, while companies with revenues between $25 million and $100 million use financing in 86 percent of their acquisitions, the report says, and the market for equipment financing is forecasted to grow to $778 billion in 2014.