In a harsh economic environment, UK businesses are on aggregate holding firm on last year’s position and signing a comparable number of new deals to lease essential equipment. From tractors and plant machinery, to photocopiers and laptops, figures were almost like for like when measured against the second quarter of 2021.
The Acquis Index is a leading economic indicator of how much equipment UK companies lease, and how for long. Published quarterly, the latest edition reveals that:
- Overall, new leases signed by UK companies during the second quarter of 2022 have grown 1.6% compared to the same period last year
- However, growth is still only 6.3% higher than that of June 2020 during the middle of the pandemic, suggesting a sluggish recovery
- 2022’s UK lease inception data is particularly volatile: up 37.4% between January and March, down 5.6% from March to May, and down 9.9% May to June
However, when compared with EU data, with the same types of equipment across the same type of sectors, UK companies are actually fairing better (see chart above right). New leases in the EU are down 33.1% against the UK’s 1.6% increase. In other words, the UK has outperformed the EU by 34.7%.
Taking a closer look at the data by sector, the Acquis Index highlights some interesting trends:
- Restaurant and retail: performing strongly
- 6% more equipment leased than over the second quarter in 2021
- 6% over the same period in 2020
- Computer equipment: falling off significantly
- -12.4% over the last quarter
- -32.7% over the same period last year
- Office equipment: holding firm
- 4% growth since Q1 2022
- 1% over the same period last year
James Rudolf, Chief Commercial Officer, Acquis Insurance, says: “Companies must feel like they’re being attacked by a pack of economic wolves: inflation, interest rates, hammered supply chains, the cost of living crisis… so you may be expecting this reflected in business confidence. The good news is, they’re holding firm, especially compared with Europe – but for how long remains to be seen.
“Against such oppressive economic conditions, we may start to see management teams grow more reluctant to sign new deals to lease equipment that is vital to their operations, staff retention and growth prospects, as business confidence is dented and costs start to bite.
“Yet there are some positive signs that growth has continued throughout the second quarter of 2022, albeit at a slower rate than hoped. Restaurants and retail outlets are one sector that is clearly still investing – hopeful they can combat a cost-of-living crisis that is already seeing UK families reduce discretionary spending.”