Australian SMEs have purchased business equipment and machinery in record volume in the last financial year according to data released by the Commonwealth Bank of Australia (CBA).
CBA’s 2022 financial year results recorded the largest volume of new asset finance lending in the “bank’s history”. It saw businesses in agriculture, manufacturing and production increasing demand for equipment and machinery.
The latest data released by the big bank highlights assets such as forklifts increased by 49 per cent, trailers increased by 37 per cent and prime movers increased by 11 per cent.
Alongside the aforementioned equipment, truck purchases also increased by 13 per cent while agricultural machinery and prime movers saw an 11 per cent increase.
Results of a Business Survey conducted by National Australia Bank (NAB) showed that business confidence continued to increase as company profits rose during the pandemic.
Another insight from NAB’s Business survey revealed that profitability had risen (by 17 points), which indicates that businesses are currently “able to absorb increased input prices” in part by passing along the costs to their customers.
“Many have increased their investment in productive capacity to strengthen their businesses and are taking positive action to overcome issues including supply chain disruptions by refining procurement processes and asset management.
“This led to significant investment in new vehicles, equipment and technologies in FY22. Businesses are continuing to adapt their strategies in response to the changing operating landscape and ongoing uncertainties in the domestic and global environment.”
NSW, Queensland and Western Australia drove business demand for construction equipment and construction vehicles due to an increase in funding.
NSW saw a 93 per cent rise in finance for earthmoving equipment with a 27 per cent rise in finance for trucks, while agriculture equipment went up by 18 per cent in Victoria.
North of the border in Queensland saw a 39 per cent increase in asset finance for earthmoving equipment. Western Australia saw a 22 per cent rise in earthmoving equipment and a 42 per cent increase in asset finance for trailers and heavy haulers.
Michael Vacy-Lyle, CBA group executive for business banking, said the growth in the 2022 financial year suggested that most businesses were “still positive about the future” despite the repercussions of rising costs and supply chain constraints.
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