Market overview in 2020 and H1 2021 results

Leaseurope, the trade association representing the European leasing and automotive rental industries, has released European leasing market figures for the first semester of 2021, comparing them with the latest annual results for 2020 published earlier. These figures show that, after experiencing a downturn in 2020 compared to the previous year in the face of the COVID-19 pandemic, the European leasing market turned on the recovery path in H1 2021.

The 2020 Annual Statistical Enquiry showed that total new leasing volumes in Europe reached €351.9 billion in 2020, decreasing by 14.2% compared to 2019. While the outstanding portfolio remained relatively stable overall, it masked uneven changes across the member associations reporting by country.

Most of the national leasing markets across Europe saw deteriorating results, with about three quarters of countries recording double-digit declines in 2020 compared to the previous year. The Baltic region, Croatia, Portugal, Spain and Morocco endured the biggest losses, with total new leasing volumes falling by over 20%. In contrast, Ukraine, Turkey and Greece were the only countries indicating growth in new volumes in 2020 while picking up from low levels reached in past years.

The European leasing market underwent a downturn across all the major asset categories. A contraction of the automotive sector had a substantial negative impact on the total business in 2020, with new leasing volumes for passenger cars declining by 14.1% and for commercial vehicles by 16.2%. Other key asset segments, such as machinery and industrial equipment as well as computers and business machines also suffered, shrinking by 7.9% and 9.7%, respectively. The leasing of real estate saw a drop in new volumes of 23.2% in 2020 to reach €11.9 billion.

As the results of Leaseurope’s 2021 Biannual Statistical Survey reveal, during the first half of 2021, the European leasing market strongly rebounded following last year’s exceptionally low base of comparison caused by the severe impact of the lasting COVID-19 pandemic.

Total leasing volumes in the first half of 2021 were €152.9 billion, higher by 32.1% than the same period of 2020. Vehicle and equipment leasing increased by 39.4% and 24.7%, respectively. Albeit at a slower pace than equipment, real estate leasing also enjoyed an increase of 7.8% in new volumes in the first half of 2021. The recovery in leasing business was widespread across European countries.

“After a challenging 2020, upbeat results of our biannual survey point to the leasing business moving in tandem with improving European economic activity as the pandemic containment measures gradually ease. While facing some headwinds, such as continued supply chain disruptions in various industrial sectors, a boom of postponed consumption and rising energy costs putting upward pressure on prices, further economic recovery is expected for the remainder of the year. Based on the European economic forecast, investment should strengthen on the back of a favourable prospects for domestic and external demand as well as the implementation of the Recovery and Resilience Plans across the EU. As business investment drives demand for asset finance, this clearly gives grounds for cautious optimism in the leasing business.”