W hen there's a recession the supply of good late-model used
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trucks dries up. That's a Fact. With little money around to buy new equipment— and precious little reason to buy— operators look long and hard at their replacement cycles. Three years from new becomes five; five becomes seven and seven is likely to become "until it drops."
While most hauliers have still to experience any kind of "feel-good Factor", business is picking up. New truck registrations are rising so shouldn't that have released more stock back into the used market?
The classified pages of CM confirm that volumes are up—but good quality late models are still hard to come by. Why? One answer is that, while many operators have got more work coming in, they've taken up the previous slack with what good equipment they've got—and they're holding on to it.
The problem is universal. Even those used dealers with links to rental and leasing Fleets (who you'd expect to have good access to late-model vehicles) are having to work hard at getting stock. Rental companies are becoming much more astute when it comes to releasing large numbers of vehicles onto the used market.
While there's been some de-fleeting after the Christmas rush, operators are generally running longer leases; the three-year lease is now five and that's keeping the trucks away From the market. Extension of existing leases is also becoming more common as equipment becomes more reliable. So for the moment the market will stay short of good late stock. If dealers know when the famine will end, they're not telling. And that's understandable.
In March the prospects are good for new or used car-derived-van sales. The re-engineered Escort van, complete with "smiley" grille, has been well-received by operators although the enthusiasm for the face-lifted model has produced some hesitation in the market for the previous van. Consequently, prices for one or two-year old vans are dropping back a little and certainly more than with the competition, although the Escort is still King. After proving so successful over the past two years the Courier seems to be losing some of its appeal. Now that supply is easing, for both new and used examples, the market will have to set the correct residual level.
In the used panel van market the big question For the trade seems to be when is the supply of good clean Transits going to improve? The shortage is being partly exacerbated by some big Fleet operators holding back on their disposal programmes. The used truck market is going through a relatively stable period at present with most values remaining Firm. It is pleasing to see stronger customer demand for boxes and dropsides at around six to eight years old. This is largely down to the value-for-money label they carry and the shortage of newer options. Cranes are still good news when and where mounted, almost regardless of which vehicle they accompany. There's still some doubt over the used heavy tipper trade despite new sales going from strength to strength. Although concern is voiced over the current price levels for a majority of used eight-leggers, this is not true for six-wheeler business. The uncertainty can be put down to the current reduction in road building, an unsettled construction scene and some overdue re-alignment of values after past years. On the used tractor Front it was interesting to note that this time last year the market was waiting with bated breath for used examples of EuroTechs to surface in significant numbers. Recent reports indicate that this is about to happen, as well-known operators upgrade their fleets. Indications are that whilst the EuroTech will prove popular, residuals could suffer if large numbers of identical models are released at the same time. No doubt Iveco Ford will be keen to prevent this.