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The telephone is ringing...
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Dealers across the country are reporting a rising tide of inquiries from hauliers about second-hand trucks. Could this be the start of a recovery in the used vehicle arena?
Words: Steve Banner Alan Webb, used truck sales specialist at Nottingham Renault dealership RH Commercial Vehicles, reports: "The phone has been quite busy over the past few days. Callers have been asking about everything from Midlums — which makes a change, because the 7.5-tonne market has been pretty quiet — to Magnums."
"We're getting a lot more phone calls and there are signs of a mild improvement in the market," says Andy Mackay, used sales specialist at Manchester DAF dealership Chatfields. "I'm hoping it's the start of the recovery."
"The phones are ringing again, but you still have to fight for every hit of business," says Jason Addison, commercial manager at Ipswich-based Used Trucks Ltd, part of the Seven group of companies. "You have to chase customers a lot harder than you did previously in order to close a sale."
Customers are also well aware that it is a buyer's market, and that there are plenty of good deals to be had as a result.
Addison's cause is helped by Used Trucks specialising in rigids at non-mainstream gross weights:13and 14-tonners, as opposed to 7.5-tonners.
"The number available and the number of places operators can go to in order to get them are both quite limited," he observes. "By contrast, there are a lot of 7.5-tonners about, and a lot of dealers selling them."
Healthy demand
Many of the rigids he stocks are designed to haul rolls of carpet. There is still a healthy demand for them, he reports, despite the collapse in house-buying.
"People are having to stay put rather than move thanks to the credit crunch, so they're doing up their homes," he says.That could involve, say, re-carpeting the lounge.
Some purchasers are so eager to get hold of a 13-tonner that they will buy one with a carpet body on the back, even if they do not want it, just to get the chassis, says Addison. "Once they've got it they'll get rid of the body and maybe have the chassis rebodied as a curtainsider, or put a crane on the back," he says.
"Business is good, but it's not great," observes Andy Smith, used sales specialist at Volvo dealership Thomas Hardie's Middlewich, Cheshire-based used truck centre. -There are sales to be had, but you have to work hard for each one."
Operators who are in the mood to buy are not in the mood to throw their money about.
"You've got more of a chance of selling a tractor unit priced at below £20,600 than you have of selling anything more expensive," says Mackay. "£20,000 is a significant psychological barrier."
With that sort of budget you should be able to purchase something with an 05,55 or 06 plate that has covered from 400,000km to around 500,000km and has a full service history. "The service history is vitally important," Mackay observes.
"All salesmen need to remember that they're dealing with highly knowledgeable customers who probably know more about the vehicles concerned than they do," he continues. "They know that all trucks of whatever make have inherent faults and they want to check the service record to ensure they've been attended to," Anthony Wright, managing director of independent dealership European Vehicle Sales and based near Doncaster, agrees that hauliers are watching the pennies.
"So far as units are concerned, they're looking to spend about £15,000," he says. "For that sort of money you'll get a nice fleet motor — probably 2003 or 2004-registered depending on the make — that's done maybe 500,000 to 600,000km, but what you won't get are all the bells and whistles."
Operators may of course be disappointed with the prices they are offered for their trade-ins, especially if they bought the vehicles concerned a year ago when the market was booming.
"They have to be realistic, though," Wright argues."We can only give them what their part-exchanges are actually worth now "However, they are paying perhaps £5,000 to £6,000 less for the truck they are acquiring than they would have paid for the equivalent vehicle 12 months ago, and that's something we point out to them."
Keep on running
If the truck the haulier is trying to dispose of was acquired on finance, then the trade-in value may of course be insufficient to allow him to clear the outstanding debt —especially if the deal was struck in the boom times of early 2008. "In that case, he may have no choice but to keep running it for another year and make a dozen more payments in order to bring the debt down a bit," Wright observes.
Lee Smith (right), a director of West Thurrock. Essex independent dealership Hanbury Riverside, has responded to the new age of austerity by marketing a selection of budget-priced 2004-vintage units sourced from a wellknown fleet operator.
"We purchased them at a sensible price and we're offering them at around £16,000 each," he says."That's about £5,000 to £6,000 less than they should be and we've sold half a dozen already "A year ago a truck of equivalent age and specification would have cost around £28,000 to £30,000.
"They're targeted at operators who need a truck because they've got a job to do but either don't want or cannot afford to spend £50,000 to £60,000," he continues. "The units have typically done in the region of 500,000km and we're selling then with a year's MoT plus a threemonth driveline warranty."
Smith is continuing to offer later-registered vehicles too.
Mackay agrees with Wright and Smith that trucks are a lot cheaper than they were a year ago. "We're selling trucks at 119,000 when the equivalent vehicle would have cost £33,000 last April," he remarks. NI