What’s on the Horizon?

New Foundation report spotlights forward-looking economic and industry insights.

The Equipment Leasing & Finance Foundation is pleased to present the 2019 Equipment Leasing & Finance Industry Horizon Report. The 2019 Horizon Report emphasizes forward-looking economic and industry insights related to the U.S. economy provided by Keybridge, the Foundation’s researchers. The 2019 Horizon Report includes an opening section presenting the results of a Foundation-commissioned survey of equipment end-users conducted in July 2019. The survey, which is more than double the size of last year’s survey, provides the data to estimate the current size of the equipment finance industry, assess the propensity to finance private sector equipment investment for key equipment verticals and forecast end-user plans to acquire and finance equipment over the next 12 months.


The second half of the 2019 Horizon Report provides a detailed analysis of recession risk. One new feature of the report—the Recession Monitor—is a customized set of indicators designed by Keybridge to help industry leaders anticipate the timing of the next recession on a monthly basis. While a recession does not appear imminent in the next six months, it does make clear that industry leaders need to be thinking about how to position their businesses for a downturn.

Key findings from the 2019 Horizon Report include:

• Total equipment and software investment continued to grow in 2018, with nominal investment expanding by 5.9% to $1.8 trillion. Based on the results of the Foundation’s end-user survey and analysis by Keybridge, approximately 50% of this investment (and 55% of private sector investment) was financed, resulting in an industry-sizing estimate of about $900 billion.
• According to the end-user survey (which focused only on private sector investment), the most common payment method used by businesses to acquire equipment and software in 2018 was leasing (24%), followed by lines of credit (16%), secured loans (12%) and other forms of finance (3%). Among non-financed acquisitions, cash (27%) was the most prevalent payment method, followed by paid-in-full credit card purchases (17%) and “other” (1%).
• The end-user survey also revealed that 79% of respondents who acquired equipment or software in 2018 used at least one form of financing to do so (i.e., lease, secured loan or line of credit). This represents a substantial increase compared to the Foundation’s 2017 estimate (58%) and a return to levels observed in 2015 (78%) and 2011 (72%).
• As the longest expansion in U.S. history continues, several economic indicators that have historically provided early warning of a downturn suggest that there may be a slowdown ahead. Overall, a recession will pose challenges for most players in the equipment finance industry. However, those challenges might be mitigated by the adjustments equipment finance professionals can make now to their portfolios and strategy in the months leading up to a recession and at recession onset.

The complete report is now available for free download. Visit www.leasefoundation.org to access this free planning tool.