The Construction Group at Wells Fargo Equipment Finance in its annual industry forecast reported an “Optimism Quotient” of 106, the third-highest national optimism reading in the past 13 years with only 2005 and 2012 being higher. Construction industry executives are optimistic that non-residential construction activity will improve in 2013. Optimism among construction equipment distributors is also high, with rental fleet growth anticipated to play an increasingly important role in their business model.
While optimism is high for non-residential, it is also high for residential construction activity, with more contractors expecting it to increase (46.7 percent) than decrease (45.5 percent.) Although 41.2 percent of construction executives said they anticipate an increase in local non-residential construction activity, 49.9 percent said they expect non-res levels to remain about the same. Distributors, however, typically are more optimistic, the report said, with a 24-point gap between contractors and distributors for the 2013 survey.
Contractors were surveyed on how distributors could better meet their needs with 47 percent citing price as the most important area for “improvement,” with improving finance options at a distant 15.3 percent, improving service and improving inventory in the third spot at 12.6 percent.
When it comes to rental, 50.5 percent of distributors said they expect to increase the size of their rental fleet in 2013, with only 5.5 percent saying they expected to decrease the size of their rental fleet. Forty-four percent said they expected the rental fleets to remain the same.
To view the complete survey, click on: http://images-mail.wellsfargoemail.com/Web/WellsFargoWholesaleServices/%7B18f01273-a35a-4bbd-9a43-15812689842b%7D_2013_Wells_Fargo_Construction_Industry_Forecast_FINAL.pdf.
