Equipment Outlook 2020

Construction is the big winner, ranking first for the seventh consecutive year.

What are the hottest equipment sectors in 2020? The answer is construction, medical equipment, hi-tech/computers and machine tools, according to a survey of ELFA member asset managers and consultants conducted in December 2019 and January 2020. “What’s Hot/What’s Not: Equipment Market Forecast 2020” reveals industry perceptions of 15 equipment markets based on a survey of ELFA members. The following are the top four equipment types from the survey:

Construction—Construction was the big winner of this year’s survey, ranking first for the seventh consecutive year. It ranked number three in largest increase in residual value sentiment. The outlook for construction remains good, based on pent-up demand for housing and commercial structures, as well as civil projects. An infrastructure bill, if passed, would be a huge plus to this already hot segment.

Medical Equipment—Medical equipment finished in second place, up from fourth last year. This industry still suffers from confusion regarding the future of healthcare finance with changes to the Affordable Care Act. The industry has a preference for leased equipment, which continues unabated. The medical equipment secondary market is robust, and the global refurbished equipment market is forecast to grow sharply.

Hi-Tech/Computers—This sector continues to operate on very low margins but has a vast secondary market. For 2019, global sales increased for the first time since 2011 by about 2 percent. Sales are forecast to decline by 2 to 3 percent in 2020.

Machine Tools—Based on preliminary data, primary market sales for metal cutting equipment decreased by about 18 percent in 2019. Sales are expected to continue at this lower level through 2020 due to softening economic conditions. Meanwhile, metal fabricating equipment sales fell by about 38 percent in reaction to softening conditions in the automotive industry.

Download your free copy of “What’s Hot/What’s Not: Equipment Market Forecast 2020,” authored by Carl Chrappa of The Alta Group, at www.elfaonline.org/data/market-trends.