It would be fair to observe that the past 12 to 18 months have been tough for most businesses associated with the construction sector, including the crane industry. Economic conditions have been difficult to navigate with interest rates high and cash flow tight. For Chris Burke, Senior Partner at Finlease, spring has brought a change to these conditions and there is light at the end of the tunnel.
“We’ve seen reductions of at least one per cent from most major funding bases on cranes and when you’re talking a million-dollar investment on a machine, one per cent does make a difference. To gain perspective one per cent on a five-year loan can save you between $20,000 and $30,000 (depending on residual etc).
“Falling interest rates is the big stimuli for many conversations at the moment. Since the end of the financial year, conversations have pivoted and reverted back to ‘what are we doing next and what’s the next investment?’ Whereas conversations earlier in 2025 were tough. I certainly feel the tide is changing, and lower interest rates are one of the drivers,” said Chris.
Finlease has noticed another emerging trend as the end-user market is now more adaptive to specific asset types, the customer buying the asset classes and brands is widening.
“Historically investment into cranes has been very centred around the major brands. Now, we are seeing a broader investment across different makes and models. People are investing in a much wider range of products and Finlease can support all of them, we are able to finance any brand,” said Chris.
“If a customer is purchasing a European, Japanese, Chinese, New Zealand, Australian, or from anywhere in the world, we can support them in their purchase. The problem for several of the banks is they don’t always understand what the secondhand value of these newer emerging brands is going to be in five years’ time, because time has not allowed the banks to build the data required to allow them to understand the value retentions.
“Banks will often take a cautious position with emerging brands. With brands that are known there is a mature secondhand market, and they are quite happy to take a residual of some assets because they are reasonably confident of the value at the end of the term.
“Some of the banks are not saying that the other brands won’t have a value, but they simply don’t have the available data as yet. To take the risk out of the equation, it can sometimes be safer to finance the equipment in an aggressive loan structure – meaning financing the asset with a nil residual at end of term. That’s one of the paths that banks have taken. This way the banks feel they are not leaving the customer at risk of what the secondhand value might be at end of term and if the machine is worth value at the end, the customer can sell it and realise that equity/money,” said Chris.
For Finlease, the changing landscape isn’t limited to number of brands now being financed. Chris said it is also finding the customer base is widening as the generational change within the industry continues.
“Recently I was in Townsville for CICA’s (The Crane Industry Council of Australia) Regional Meeting and talking to a number of regional crane companies who have only ever dealt with their local, inexperienced bank manager who seems to change every couple of years,” said Chris.
“They highlighted how isolated they feel when the banker leaves and moves on. Finlease has multiple offices throughout Australia and has always worked in regional communities, it is this sort of experience and knowledge that allows us to provide competitive products and offer a better financial solution for the customer as we are not limited by the local branch one bank policy,” he said.
Another interesting trend involves the movement of wealth between generations. The Financial Review has written about this at a national level and Chris has seen it emerging in the crane industry. This involves Mum and Dad, who have started and operated the business for years, deciding it is time to, or are at least discussing, transfer of the business and assets to their children.
“I could give several examples of crane companies where this is happening or at least the conversations are starting. With this type of ‘handover’ comes opportunity, with the younger generation having a different way of doing things. They are often more technologically adept which can help streamline business processes,” Chris said. “Because we are involved with so many family businesses, we have been meeting the next generation over the years and now, they have really smart ideas on how to improve the business and with Mum and Dad’s support, these businesses are going from strength to strength.”
Chris and the team at Finlease process economic information and data all the time including reports from auction houses, forecasts from banks and economists. He said recent data shows an outlook of slow but modest growth for Australia.
The big takeaway from August’s Economic Reform Roundtable was cutting the red tape for the construction sector – if builders and contractors are busy, cranies’ are busy.
“When I heard the take-outs from the forum my immediate thought was that’s good news for the industry. Cutting the tape for residential and commercial construction is only going to benefit the crane owners,” said Chris. “Having spoken to some tower crane operators recently, I know they are pretty upbeat around what the forward outlook looks like. That is always good news, because if there are tower cranes on the skyline that shows that the city is busy. They are certainly quite upbeat about what 2026 looks like.”