US equipment asset lending heads to all-time high

The US equipment finance industry is set for a record year according to latest data from the Equipment Leasing & Finance Association (ELFA), suggesting that recent cooling in the market was more about normalization than a weakening of fundamentals. ELFA data shows the two-year trend in activity remains upward, while the year-end forecast for total new business activity is at an all-time high.

Total new business volume among surveyed ELFA member companies was $10.5 billion on a seasonally adjusted basis, while year-to-date new business volume rose by 11.3% relative to the same period in 2025.

Leigh Lytle, ELFA president and CEO said: “2025 started off with a bang, and some cooling was always expected. Even with some easing from peak levels, business activity over the first half of 2026 is up over 11% from the same period last year. Financial conditions remain healthy. The industry-wide delinquency rate dropped to a multi-year low, and losses remain modest.

“As has been the case for over a year, the industry remains well-positioned to meet the resurgence of tariffs, hostilities in the Middle East, and potential Fed rate increases later this year.”

The overall delinquency rate fell to 1.7% in June, dropping just below the narrow band of 1.8% to 2.1% that it has been in for the last two years. The rate at banks dropped by 0.48 percentage points, more than offsetting the sharp rise in the prior month. The rate at captives and independents both fell.

ELFA member Kyin Lok, CEO for Dext Capital, said: “Customers largely looked past Middle East tensions, tariffs and energy spikes last quarter, while record high consumer debt and the prospect of gradually higher interest rates remained the biggest external pressures.

“Even so, customer health remains steady, portfolio performance remains solid, and the booming stock market reflects continued economic confidence and resilience in a new reality where change is the only constant. Over the next three to six months, we expect healthy equipment finance demand, led by accelerating AI data center investment and a gradual rebound in specialty transportation.”

Despite subdued demand, inflationary pressures remain evident. Selling price expectations across the services sector stayed elevated at +14% in July. Business and professional services firms expect prices to rise at a balance of +11%, while consumer services businesses continue to anticipate stronger price increases (+24%), although these expectations have eased from previous months.