CED

September 2013

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Money ("Credit Aplenty" continued from page 23) When capital became scarce, lenders had to become more selective. "The market may have construed that as tightening," Case said. However, he adds, the quality of the customers that were getting financed was actually increasing during the downturn because of the decrease in available capital." Now that the economy has seen a recovery (it's arguable when, if ever, it will fully recover to its previous state), Case says his group of lenders "might be slightly more adventuresome" with some types of credit in certain sectors because those sectors are performing well. Construction recovery is starting to come back in some areas through housing starts, which is resulting in increased infrastructure, he says. The increased infrastructure is resulting in increased equipment being purchased to satisfy contracts. "Any of those pockets where housing starts have increased is causing a ripple effect…. we are seeing increased equipment purchases, increased demand for lumber, which is hauled by truck and rail and causing increases in the construction sector," Case said. The U.S. recovery has seemed more remarkable because the nation's economy dipped so dramatically. "We're seeing a nice uplift with the rebound," Case added. The Canadian market remains a bit less of a volatile market. Recovery isn't as dramatic but the country has had less of a downturn. However, we're not out of the woods yet. "I still think it will be another few years before the U.S. starts firing with all eight cylinders," Case said. Construction spending is trending in the right direction, with residential and power related projects being the primary drivers, according to a Wells Fargo analysis this spring. "End users, generally speaking, are experiencing better results – the amount of work and the quality of work continues to increase/improve; the number of bidders on projects continues to become more normalized, which has improved margins to a certain degree. The industry is expected to continue gradually improving, with moderate growth expected for 2013," according to the analysis. However, Case says he fears that when the market "heats up and becomes more competitive," people move away from the core of credit disciplines that would drive a wellperforming portfolio. "It's important for both dealers and users that the equipment financing market remains strong, because finance is still a major catalyst in most equipment sales," Case said. "Without a robust and healthy equipment financing market, that means fewer sales. That results in fewer trade-ins, which means less used equipment is sold." 1st Bank's Shute says despite the bumps in the road, the best is still to come. "We see positive trends that will continue. Not astronomical upward movement, but modest, cautious movement. The tough part is to try and sustain the momentum instead of waiting for the other shoe to drop." n Tina Grady Barbaccia is a writer/ editor who has been covering the transportation/ construction industry for the past 10 years. She can be reached at tinabarbaccia@gmail.com. Advertisers' Index Apex Supply Chain Technologies. . . . . . . . . . . . . . . . . . . . . . 48 ARGO - Extreme Terrain Vehicles. . . . . . . . . . . . . . . . . . . . . . 46 B4 Consulting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Bell Trucks of America. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 BOKF Equipment Finance Inc.. . . . . . . . . . . . . . . . . . . . . . . . 23 Coneqtec Universal. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Direct Capital Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . 17 e-Emphasys Technologies, Inc.. . . . . . . . . . . . . . . . . . . . 28-29 EPG Insurance, Inc.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 HKX, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Infor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Knapheide Manufacturing Company, The. . . . . . . . . . . . . . . 39 Leading Edge Attachments. . . . . . . . . . . . . . . . . . . . . . . . . . 19 Manitex . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IFC Manitou North America. . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 PFW Systems Corporation. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 PriSim Business War Games, Inc.. . . . . . . . . . . . . . . . . . . . . . 13 Ritchie Bros. Auctioneers . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 SANY Heavy Industry Co., LTD . . . . . . . . . . . . . . . . . . . . . . . . 9 Sentry Insurance Company. . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Vacuworx Global, LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Verizon Networkfleet. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Wacker Neuson Corporation. . . . . . . . . . . . . . . . . . . . . . . . . 25 Wells Fargo Equipment Finance. . . . . . . . . . . . . . . . . . . . . . . 21 Werk-Brau Company, Inc.. . . . . . . . . . . . . . . . . . . . . . . . . . IBC XAPT Corporation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . OBC As the official magazine of Associated Equipment Distributors, this publication carries authoritative notices and articles in regard to the activities of the association. In all other respects, the association cannot be responsible for the contents thereof or the opinions of contributors. Copyright © 2013 by Associated Equipment Distributors. Construction Equipment Distribution (ISSN0010-6755) is published monthly as the official journal of Associated Equipment Distributors. Subscription rate — $39 per year for members; $79 per year for nonmembers. Office of publication: 600 W. 22nd St., Suite 220, Oak Brook, Ill. Phone: 630-574-0650. Periodicals postage at Hinsdale, Ill. 60521 and other post offices. Additional entry, Pontiac, Ill. POSTMASTER: Send address changes to Construction Equipment Distribution, 600 W. 22nd St., Suite 220, Oak Brook, Ill. 60523 September 2013 | Construction Equipment Distribution | www.cedmag.com | 55 20_Credit_Feature_Index_KP.indd 55 8/28/13 12:37 PM

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