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Equipment Manager Confidence Drops

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Confidence Index.

Confidence among equipment managers fell in the fourth quarter, according to the Equipment Manager Confidence Index, published by Construction Equipment. The Q4 2021 Index is 105, down from the 117 reported in the third quarter of this year. The Index returned to its Q2 level, when it was 106. It had been as low as 99 in June 2020. The Index measures equipment manager confidence on a scale of  0 to 200, with 200 indicating full confidence that the next month will be “better.”

“Respondents also dropped their economic outlook,” says Rod Sutton, editorial director. “That index dropped below 100, which means more expect it to be worse than expect it to be better. The optimism that greeted the summer seems to have dissipated as we head into the end of the year.

“Fleet managers also remain pessimistic about acquisition timing,” Sutton says. “That index also is below 100, but it has been since the pandemic began. Supply chain issues and the failure of Congress to move on infrastructure is no doubt sapping confidence.”

The Equipment Management Confidence Index is published and available to the entire industry at ConstructionEquipment.com/EMCI. Other data trends are available only to members of the Index group. For example, members continue to plan for more maintenance spending in coming months.

Additional insights available to members:

  • Overall economy health
  • Current fleet health: now v. last year
  • Future fleet health: now v. next year
  • Equipment acquisition: better or worse to buy new
  • Equipment disposition: better or worse time to sell used
  • External rental: better or worse time to rent
  • Peer to peer rental: better or worse time to generate revenue
  • Planned maintenance: spend more or less than last year
  • Rebuilds: more or less likely than last year

In addition to the Confidence Index, members of the platform also provide opinions on trends within asset management, including acquisition expectations, rental plans, and maintenance. In the third quarter, for example, the index showed that managers are not looking at the next few weeks as a good time to buy new equipment. With the free access, managers can see how the trend is unfolding and compare themselves to others in the platform.

Equipment end users can have access to these insights for free. Others, such as manufacturers or dealers, may gain access to the data as observers by registering here. The next Index computation occurs at the end of December. Equipment managers can join the group anytime this month in order to provide opinions and access quarter-over-quarter trends. Baromitr’s visualization features also allow members to analyze performance and compare how they are doing relative to others in the group.

The data-driven Index is powered by Baromitr, a scalable, peer-benchmarking platform. The Equipment Manager Confidence Index is a custom algorithm that combines multiple inputs to calculate a score from 0 to 200. The higher it is, the more confident equipment managers are.