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Rising fuel prices hit used sales
Page 72
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Soaring diesel prices and the recent 2p/lit fuel duty increase may be prompting some operators to think twice before they buy a truck. Steve Banner reports.
NI eople knew the rise in duty was on its way, but until now the implications hadn't really registered with them," says Lce Smith, a director of West Thurrock, Essex, independent used truck dealership Hanbury Riverside."They're now starting to feel the im pact, and we've already seen orders for two trucks cancelled because of the high cost of diesel.
"Fortunately we've been able to sell them to somebody else, but operators are clearly becoming worried about what's happening. If! didn't have such a solid customer base — our sales are still very strong — and if I didn't know that most operators appear to have plenty of work on at present, I'd be getting a bit edgy."
He believes the fuel price hike may be affecting sales at some of his competitors too: "They seem to be advertising the same vehicles day in, day out, and they're starting to cut their prices."
Phil Holmes, used sales manager, eastern region, at Scania dealership Keltruck.says customers have not yet cited the cost of diesel as a serious issue but concedes it may be early days. What he has noticed is a slight easing of the acute shortage of late-year, low-mileage stock that has bedevilled the industry for much of this year. "That may be because everybody who was desperate for a truck a few months back has been able to get hold of one," he suggests.
Long lead times
But I lolmes doesn't expect supply and demand to be in balance for some time. Long lead times on new chassis are still prompting a huge amount of interest in lateyear, low-mileage used trucks, and he does not believe those lead times will shrink any time soon: "We're quoting September 2008 delivery times on new Scanias, and some manufacturers are quoting as far ahead as January 2009."
While more investment is being made in production facilities, Holmes believes this will not brings lead times down immediately. "In the meantime they could be extended even further," he predicts.
"One consequence is that some operators are hanging on to their existing vehicles for longer because they can't get new ones," says Keith Whitaker, used truck specialist at Southampton Daf dealership Adams Morey."I don't know when the situation will get any better."
Another consequence he has noted is the greater willingness of hire companies to take used trucks from dealers to cope with the rise in traffic in the run-up to Christmas: "The position