Supply and demand
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Thomas Hardie Commercials used sales executive Jonathan Bownes says supply is diminishing as demand increases
Words / Images: Kevin Swallow
The nature of selling used trucks has mutated beyond recognition, with the recession and legislation continually altering the landscape. Jonathan Bownes, used sales executive with Middlewich-based independent Volvo Trucks dealer Thomas Hardie Commercials, has 15 years’ experience selling used and new trucks and is amazed at how the job has changed.
Driving this is legislation in the form of: digital tachographs, Euros-4/5/6 and London’s Low Emission Zone (LEZ). “The UK truck job is not the job it was 18 months ago, three years or even seven years ago. Manufacturers are forced to build cleaner engines and it means the trucks are forever changing,” he says.
Alongside the recession, this has fractured the buying conidence of operators and led to inconsistency in new truck sales. The market dipped from 50,747 registrations in 2007 and 57,410 in 2008, according to the Society of Motor Manufacturers and Traders, to 27,938 trucks in 2009 and 27,588 in 2010.
In 2008, as operators stopped buying new trucks, ▲ Jonathan Bownes says Thomas Hardie Commercials reopened its rental division, the recession has got rid providing customers with new vehicles through hire of the cowboys, leaving agreements as well as keeping its workshops busy. more professional dealers
One thing the recession has done is get rid of some of the “bottom feeders, the ly-by-nights, the cowboys, the people up to no good. They are the people that have suffered the most. The people in it now are in it for the long haul and are a lot more professional,” he says.
Operators have also changed their requirements when it comes to sourcing and running secondhand trucks. “It got to a point three years ago that the cheapest price wins, and that is not really the case now. If you can demonstrate that you can deliver a higher level of service than the man next door and are 10% dearer, people will go for that,” he says.
That means delivering an aftersales service that minimises downtime for the operator, and many go for preventive maintenance that includes all the six-week inspections. “There is nothing we can do for a new truck that you can’t do for a used truck, it’s just the cost.
“If you want a full maintenance package on a three-year-old truck you have to take on board it’s more expensive than a new truck,” he says.
Demand for late-year Euro-5 trucks to meet legislation means used truck values change every day. “Legislation, like the Euro-rating, digital tachographs and LEZ compliance, has made the right type of vehicle increase in value and sell quicker, and it’s made the wrong vehicle decrease in value and stick around longer,” he says.
Global market
Bownes says there is a home for everything in a global used truck market, though the home might not be Edinburgh, Leeds or Manchester, but rather Botswana, Kenya or Malaysia. “The further down the ladder you get for homes, the further down the ladder you get for values – it makes us wary about what you bring in,” he says.
Supply is also becoming a major issue. “We have taken trucks out of the bottom end (Euro-3 and pre-2006 registered for export) and not put them in the top end.
“It has created a vacuum where the people who want them at the bottom have got to pay more because they want better equipment. There are so few 2009 and 2010 registered trucks out there and as a result we have very little at the bottom end and very little at the top end and a glut of vehicles in the middle,” he says.
In the yard, although Thomas Hardie Commercials has a lot of trucks, it really has only three types on sale, says Bownes. “There is a row of 2008-registered FHs and the other row is 2007-registered FMs; if you want something newer I haven’t got it; if you want something older I haven’t got it.
“In our glorious heyday, we’d have stocked anything up to 150 trucks and up to £3m-worth of equipment of every shape and size and mileage. We are running now at £750,000 to £1m of equipment at any one time,” he says.
Truck sales from 2007 and 2008 will also start to affect supply through 2012 and 2013, and Bownes is concerned that the job will get slightly harder. Euro-6 legislation, due on 1 January 2014, presents another problem, as operators consider having to pay more for the technology that delivers a heavier chassis and potentially worse fuel economy.
“You have to change the buying patterns. Legislation won’t stop at Euro-6. There are half a dozen pieces of legislation before 2020 that are going to prompt buying decisions,” he says. ■