A NEW KIND OF USED
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Ask a dozen UK franchised truck dealers what they think of used commercials and you're likely to get 12 different answers. Among the more switched-on distributors used sales have been the only way to make money since the collapse of the new truck market. But they are not in the majority.
For many franchised dealers second-hand vehicles are an unavoidable pain—something to take as a trade-in to get that all-important new chassis out the door. Not surprisingly the chassis manufacturers have been keen to get their dealers more interested in used sales. But why go to all that trouble? The answer, in a word, is residuals.
In a world where whole-life costs now mean more than ever before truck manufacturers, not least those heavily involved with contract hire and leasing deals, must be able to forecast the value of a truck when it ceases to be owned by the first-time buyer.
Short of phys ically buying up every one of its used vehicles a truck maker can only do so much to control residuals. Snappy sales slogans, refurbishment pack ages and extended warranties have all been tried with varying degrees of success. Now Daimler-Benz is entering the arena with its NGC Used Vehicle Centre programme. On the face of it this is a sensible move. Why let a handful of keen franchised dealers and all the independents take all that gravy? And make no mistake there's plenty to go round. According to D-B by 1998 its first NGC used truck centre in Germany could be enioying an annual sales revenue of 232m. It won't stop there. The German Giant is planning to establish NGC outlets in a number of European countries including the UK. MercedesBenz (UK) admits that the UK NGC is "very much in the planning stage", but is this the face of used truck sales in the future? Before anybody shouts "Monopoly" M-B(UK) has confirmed that NGC centres will sell any brand to anyone, not just to Mercedes franchised dealers. It will be interesting to see how the independent used dealers react. Without the cash clout of corporate marketing will they see their business eaten away by the likes of Daimler-Benz, or any other chassis manufacturer who's no longer content to see the used truck market dominated by such free-spirits? And what's in it for operators? The answer should be an improvement in the quality of used vehicles circulating in the market (Daimler-Benz is talking about spending money on refurbishment before sales) and a greater willingness from some franchised dealers to take trade-ins, on the grounds that they can confidently dispose of them through a "known" orgarcisation.
What it must not do is remove the current choice a British buyer has, particularly when it comes to price. As painful as it may be to European truck makers, a British haulier will only pay so much for a used vehicle: if the price ain't right he won't "come on down".