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ELFA - Equipment Leasing and Finance Association

10/13/2020 | Press release | Distributed by Public on 10/13/2020 06:04

Q4 2020 Equipment Leasing & Finance Industry Snapshot Now Available

The Equipment Leasing & Finance Foundation has released the Q4 2020 Equipment Leasing & Finance Industry Snapshot, an indispensable resource for industry participants in the midst of the COVID-19 pandemic. Designed for use in executive briefings and presentations, the presentation slide deck summarizes the current conditions and projections for the U.S. economy and equipment finance industry with clear, easy-to-digest charts and short narratives of key trends.
Among the range of details in the new release:

  • The U.S. economy nosedived at an unprecedented 31.4% annualized rate in Q2, driven by a collapse in consumer spending, particularly in high-contact service industries. Although Q3's annualized growth will be exceptionally strong given the historic contraction in Q2, a full recovery by the end of the year is highly unlikely.
  • Investment fell 46.6% (annualized) in Q2, an unprecedented collapse. Business investment dropped 27.2% (annualized), the worst quarter since the 1950s.
  • Equipment and software investment collapsed 27.7% (annualized) in the second quarter, the sharpest decline since the Great Recession. However, E&S investment is forecasted to return to positive territory during the second half of 2020.
  • Among the range of COVID-19's impacts on businesses are an expanding service industry after bottoming out in early spring, a severe effect on commercial real estate as a result of the shift to work-from-home, a resurgence in demand in the housing industry, and a thriving online retail sector as consumers shy away from in-person retail stores.
  • Equipment finance industry confidence has returned to pre-pandemic levels, although public policy uncertainty remains elevated after spiking at the onset of the pandemic.
  • New business volume growth reported in ELFA's Monthly Leasing and Finance Index contracted 24% year-over-year in August, driven by soft demand for certain industry verticals. However, cumulative new business volume for the year is down only 4.3% from a year ago.

Prepared by Keybridge Research through a commissioned grant by the Equipment Leasing & Finance Foundation, the Snapshot is available for free download at https://www.leasefoundation.org/industry-resources/industry-snapshot/.