Equipment Leasing Soars to Record Highs Amidst Geopolitical Uncertainty
Event summary
- The Equipment Leasing & Finance Association (ELFA) CapEx Finance Index shows Q1 new business volume (NBV) reached a record $10.8 billion.
- Year-to-date NBV is up 18.6% compared to the same period in 2025, and year-over-year NBV increased by 12.5%.
- March NBV saw a 1.8% contraction from February, but small ticket volume growth declined 17.7% from the prior month.
- Industry confidence dipped to 54.6 in April, the lowest level since May 2025, signaling growing concerns.
The big picture
The ELFA data reveals a surprising resilience in equipment financing demand despite significant macroeconomic headwinds. While the record Q1 volume is a positive signal, the slowing March activity and declining confidence suggest a potential inflection point. The industry's ability to navigate geopolitical risks and a Federal Reserve policy shift will be crucial for maintaining this momentum.
What we're watching
- Demand Sustainability
- The deceleration in March NBV, coupled with the declining confidence index, suggests the current pace of growth may not be sustainable, particularly if regional tensions escalate.
- Credit Risk
- The rising delinquency and loss rates, while still within historical averages, warrant close monitoring as borrowing costs remain elevated and economic uncertainty persists.
- Supply Chain
- How the ongoing conflict in the Middle East continues to impact equipment supply chains and input costs will be a key determinant of future demand and pricing pressures.
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