Black Winch recently attended the Leaseurope Annual Convention on October 5th and 6th, which was deemed a great success.With distinguished leaders from 32 countries and experts in the leasing and automotive rental industry, it served as a catalyst for thought-provoking discussions on the transformative trends that are molding the future of the market. Now, let's explore some of the highlights from this year's convention.
Leasing Market Volumes and Evolution
In 2022, the leasing market was a force to be reckoned with, boasting an impressive €404 billion in size. This is a testament to the leasing industry's unwavering growth and stability. What's even more impressive is that almost every sector within the leasing industry experienced positive performance and market share increases. For instance, the "machinery and industrial equipment" segment saw a remarkable 7.9% growth in 2022. This growth is in line with the development of private investment in Europe, underscoring the crucial role that leasing plays in driving economic development.
The UK, Germany, France, and Italy emerged as the top markets in terms of new volume. Central and Eastern Europe (CEE), Italy, and the UK show tremendous potential for leasing companies to expand their operations and tap into growing demand. The leasing industry is poised for even more growth and success in the coming years, and it's exciting to see how it will continue to evolve and shape the economic landscape.
In 2022, the European leasing market showcased remarkable industry shares, each with its own unique story. The machine and equipment sector emerged as a frontrunner, capturing a significant 17% share, fueled by an insatiable demand for cutting-edge machinery. Interestingly, within this segment, manufacturing equipment represented 52%, construction 32% and agricultural, forestry and fishing 16%. This shows how these sectors are reinventing themselves and embracing the latest innovations that are tailored to leasing solutions.
Meanwhile, the ICT industry held its ground with a steady 4% share, underscoring the unwavering need for innovative technological solutions. However, the mobility industry reigned supreme, commanding an impressive majority of over 60%. This dominance not only highlighted its pivotal role in revolutionizing European transportation but also emphasized its crucial contribution to shaping urban mobility solutions across the continent.
Leasing as a Preferred Financing Option
Small and medium-sized enterprises (SMEs) have a plethora of financing options to choose from (loans, equity, trade credit etc.), but leasing has emerged as the second most popular choice. Interestingly, high-growth enterprises, innovative SMEs, and exporters seem to favor leasing even more. This speaks volumes about the flexibility and allure of leasing as a financing method, which caters to the diverse needs and ambitions of businesses across different industries and scales.
ESG Regulations are Reshaping the Market
The leasing industry is undergoing a transformative shift due to the European Green Deal and other ESG regulations. With sustainability taking center stage, businesses in this sector must embrace change to stay ahead of the game. Flexibility and data-driven approaches are crucial in navigating these evolving landscapes. Incorporating ESG criteria into business decisions is no longer a passing fad, but an absolute requirement. Investors, customers, and regulators are all calling for greater transparency and responsible practices, making ESG compliance an indispensable aspect of success.
Embracing the EU Digital Finance Strategy
The convention was abuzz with talks about the European Union's digital finance strategy, which is set to transform the financial sector. A crucial aspect of this strategy is the establishment of a European financial data space that will encourage data-driven innovation. This ambitious initiative is based on the European data strategy, which aims to improve access to data and promote data sharing within the financial industry. The leasing industry is poised to benefit greatly from this development, as it will enable companies to leverage the power of data in their decision-making processes. This will lead to increased efficiency, streamlined operations, and exciting new avenues for growth. Get ready to witness a revolution in the world of finance!
Leasing and Green Transition
The analysis reveals a notable surge in the adoption of green assets. Leased electric cars experienced a substantial increase of almost a third (31%), constituting 14% of the overall new leased car market. Furthermore, the leasing volume for renewable energy generating equipment witnessed remarkable growth, surpassing 100% and reaching a value exceeding 1 B€. Additionally, the new leasing volume for bicycles in 2022 amounted to nearly 2 B€, exhibiting a significant rise of over 45% compared to the previous year.
The Leaseurope Annual Convention provided great insights about the ever-evolving leasing industry. From the profound influence of ESG regulations to the EU's digital finance strategy and the electrification of assets, there were critical areas that businesses in this sector must navigate. To thrive in this rapidly changing market, companies need to embrace flexibility, data-driven decision-making, and a proactive approach to adopting sustainable practices and technologies. By doing so, they can guarantee their continued success in an industry that never stands still.