Secondary market supporting equipment leasing

Rising inventory for new and used equipment is creating a strong environment for equipment leasing and asset management. 

In addition to growth in the transportation, construction and material handling sectors, Mitsubishi HC Capital America also continues to experience growth in asset management partnerships, Brian Rosa, president of commercial finance, told Equipment Finance News. 

“Now that the supply chain disruptions caused by the pandemic have largely subsided, new equipment deliveries have increased, creating more used inventory in the market,” he said. “As an asset lessor, we specialize in offering flexible equipment leasing solutions to our customers, and a key ingredient to being successful is to partner with companies that can extract top value for assets in the secondary market, so we’re working with a lot of resellers who have a specific asset knowledge and we can leverage that expertise.” 

In August, medium-duty construction used inventory rose 42.7% year over year and heavy-duty construction used inventory increased 20.9% YoY, according to Sandhills Global market reports. Meanwhile, lift Inventory increased 17% YoY. 

More effective leasing

Mitsubishi HC Capital America also possesses the internal expertise to develop more effective leasing solutions, Rosa said. 

 “Customers are typically looking for flexibility, lower lease payments, and if we can take ownership of that equipment and feel comfortable selling that equipment when it comes back to us at end of lease, it means it allows us to offer a better product to our customers,” he said. 

With MHCA’s status as a non-bank, non-captive, it maintains more flexibility to meet customers’ demands, Rosa said. 

“In my group, MHCA commercial finance group, our main value prop is our ability to execute larger ticket, customized transactions that suit customers’ unique needs, and they definitely have a lot of unique needs,” he said. “It’s not a cookie-cutter approach, and it means we need to be more flexible on how we structure and manage risk … A more heavily regulated institution may not have that same capability.” 

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