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Equipment management in period of transition

By Amy Thomas in Thought Leadership Posted February 22, 2018

Major change is underway in equipment management, whether contracting market cycles, expanding deals, a revolution of automation in manufacturing, or agriculture and compliance requirements roiling the appraisal business, says a new article in Equipment Leasing & Finance Magazine.

"In short, every aspect of the business is changing, including the equipment—and values are at the heart of the challenge," writes author Susan Hodges.

The article includes analysis from Liz Jaramillo, vice president of asset management for Key Equipment Finance, who anticipates residual values will be a stressor early on this year.

“There is a great deal of competitive pressure toward more aggressive residuals,” she said. “I expect that we will continue to have to weigh the economics of competing for deals that provide less upside at the end of the lease.”

Jaramillo goes on to say she expects strong markets this year to include heavy-duty trucks and trailers, cybersecurity software, renewable energy and machine tools.

“Class 8 orders steadily increased in 2017 and should remain strong for the first half of this year,” she said. “And regulators are considering more aerodynamic requirements and tire-monitoring equipment for trailers, both of which will increase fuel economy.”

Meanwhile the cybersecurity industry has begun introducing new products and fixes every few months to combat new threats and ransomware, Jaramillo says. And solar energy should remain hot because applicable tax credits won’t begin to diminish until 2020. The wildcard: a potential tariff on imported solar panels. “The Chinese are reportedly flooding the U.S. marketplace with solar panels, and a suit has been filed,” Jaramillo says. “There’s a possibility that a tariff will be imposed.”

Check out the article in its entirety here:

Read equipment management article



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