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Truck sho hits use
Page 52
Page 53
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Exports of newer use vehicles and operators hanging on to their trucks for longer mean that some second-hand dealers are finding their cupboards are Looking a bit bare.
Words: Steve Harmer
A strengthening used truck arena is resulting in an increasing shortage of stock. as sales staff scramble to meet the growing demand, report many dealers.
"It is becoming more difficult for us to get our hands on '07 and '08-registered vehicles," says used sales specialist at Mercedes-Benz dealership Road Range Paul Diamond.
The dealership has branches in Liverpool, Llandudno and on Deeside.
"Last May, we had approximately 50 trucks in stock," says Stuart Wolstenholme, used sales manager at the Middleton, Manchester branch of Scania dealership West Pennine Trucks. "Now we're down to 17, which is the lowest number I can ever remember, and we're having to advertise for vehicles" The stock shortage has occurred in part because certain major fleet operators are hanging on to their vehicles for longer than usual and not releasing them onto the used market because of the effects of the recession.
Another reason for dealer cupboards becoming bare is that more comparatively young tractor units are being exported rather than sold domestically. "We've just sent five '05-registered Scania R Series with Opticruise 'boxes to Tanzania," says Wolstenholme. "We'd probably have sold them in the UK, but it was an exporter who came up with the cash first." The enquiry came via West Pennine's web site (CM 22 October).
Another factor driving demand is the rising price of new trucks, thanks in part to the slide of sterling against the euro. It is prompting some operators who might otherwise have bought new to switch to late used instead, argues Wolstenholme.
"That said, we're getting plenty of interest in older, 53-plate trucks, too," he adds.
Demand is on the increase
Matt Hammond, used vehicle sales manager at West Thurrock, Essex-based dealership Harris DAF, doubts if fewer trucks are coming back off contract than was the case in the past.
He is sure, however, that the demand for used trucks is rising. "Business has, in fact, been fairly good all year," he says, adding that stocks are being soaked up as a result.
"We're finding that the price of the trucks we're buying in is rising more rapidly than the price we can sell them at," he says. "As a consequence. margins are being squeezed."
He suspects this situation will right itself over the next few months as retail prices begin to go up at an equivalent pace as their wholesale equivalents.
Paul Prewett, general manager, used sales, at east of England Scania dealership TrtickEast, believes that retail prices have already levelled out and are probably rising.
"While it would be wrong to say that we're absolutely flat-out, we're doing OK," he says. "We're certainly keeping our heads above water.
"Clean stock is always hard to find, but we've just had a lot of ex-contract trucks come hack, so stock availability at the moment isn't that big an issue for us," Prewett continues. "Our stock levels are about where they should be."
The distress selling the trade saw a few months ago has come to an end, he believes.
"Not so long ago, everybody was advertising really cheap eight-wheel tippers, but that's all finished." he says. "If you need a tipper today, then you've got to be prepared to pay decent money for it."
He believes the used market may be slowly returning to what he terms "a sensible level" — not lagued by a massive downturn, but not seeing the sky-high prices that were charged by some dealers 18 months to two years ago, either. "Confidence is returning," he says.
Something Prewett has definitely noticed is that operators who call him have stopped mentioning the recession, and ceased using it as al negotiating ploy to get him to discount the truck they are interested in.
-That said, they still want a deal," he says. "They're still price-conscious."
They're also concerned about fuel economy, and one of the first questions Prewett is likely to be asked about a truck is how much diesel it burns. "Customers also want to be able to put it to work immediately," he says.
He believes that the London Low Emission Zone is helping to keep demand buoyant. "We re seeing operators who've realised they have got to enter it getting rid of their 10-yearold trucks and buying three or four-year-old models, instead."
Hammond is finding that customers are asking for trucks with digital rather than analogue tachographs — a change from the situation a while back, when many used customers were running scared of the former and insisting on the latter.
Some dealers report that while a shortage of stock hasn't bitten just yet, they expect it to do so shortly.
Exports are slowing
"The UK market is getting busier all the time," says European Vehicle Sales (EVS) managing director Anthony Wright. "Enquiries are increasing daily and customers are becoming more willing to spend a little bit more money to secure the vehicle they want.
"I Isuspect that, as a consequence, late trucks will Soon start to become hard to find again," he says. "However. I don't think we'll see a return to the price boom we saw two years ago." He agrees with Hammond that customers are now starting to favour digital over analogue. -Digital isn't the headache people thought it would be, and analogue trucks are, of course, getting older." he points out.
While the UK market is starting to bubble agaii. Wright is finding that exports are slowing down a little. -That's certainly the case with sales to East African markets. although we're still pretty busy in that area," he says.
BEsed on the Sandtoft Industrial Estate, not far from Doncaster, independent dealer EVS also boasts an operation in Mombasa, Kenya.
"The Middle East has gone really quiet though, after booming over the past 18 months," Wright continues. "Anybody out there who wanted a truck has probably found themselves one by now." •