Scarcity of chips pushing scarcity of capability fleets to second-hand gear
The scarcity of microchips that do nearly all the pieces in a truck is stretching a scorching market. It forces fleets that want vans now to search for the newest technology second-hand gear.
Newer classic sleeper cabins and daycabs with automated guide transmissions, security gear and respectable gasoline economic system are in excessive demand.
“Prospects had been already on the lookout for low-mileage used vans as a substitute of ready for a brand new truck,” Chris Visser, senior analyst and product supervisor for business automobiles at JD Energy Valuation Providers, advised FreightWaves. “The scarcity of chips has elevated demand even additional.
“The tip result’s that used truck costs will expertise extra upward motion than we anticipated earlier than experiencing the chip scarcity.”
Costs for used Class 8 vans had been down 7% in January from December, in accordance with ACT Analysis. However as new truck orders pile up and backlogs develop, supply occasions are being pushed again to early 2022 for essentially the most in-demand fashions, like sleeping cabins.
Secondary market power
“The query of whether or not new truck consumers can flip to the aftermarket, whether or not the manufacturing and availability of recent vans is adversely affected by rising provide chain issues, seems to be again on the agenda. desk, ”stated Steve Tam, vp of ACT.
The place a glut of used sleepers existed in mid-2020, they’re now onerous to seek out.
JD Energy’s 4-year-old benchmark 2018 mannequin sleeper offered in January for a median of $ 51,179, up $ 4,269, or 9.1%, from December. Costs had been larger for every mannequin yr from 2014 to 2017.
“The provision / demand relationship is predicted to stay favorable longer than anticipated, presumably within the third quarter,” Visser stated. “After all, this assumes that macroeconomic circumstances stay according to expectations.”
Fleet Benefit, a supplier of data-driven analytics primarily based in Fort Lauderdale, Fla. To assist fleets decrease complete value of possession, launched a promote / leaseback program final Could to assist fleets monetize idle vans through the pandemic.
The sale-leaseback program generated roughly 10% of Fleet Benefit’s $ 445 million in leases in 2020, Brian Holland, president and chief monetary officer of Fleet Benefit, advised FreightWaves.
“We primarily deal with the newest technology automobiles with low mileage, geared up with all the required security gear and environmentally pleasant,” he stated. “We actually supply a high-end asset within the secondary market.”
New truck constraints
By combining its used truck enterprise with deliveries of a number of thousand new vans per yr, Fleet Benefit is ready to keep away from unloading vans at wholesale or by auctions. The constraints of buying new vans are more likely to persist till sufficient semiconductors can be found.
“It stimulates demand. This may drive up the costs. And we’ll possible see that speed up over the course of the yr as the provision of recent gear begins to tighten, ”stated Holland.
Ryder System Inc. (NYSE: R) up to date its Fleet buy-back program in mid-February. It really works very like the one provided by Fleet Benefit. Prospects commerce of their fleets and lease new vans, releasing up cash tied up in belongings.
“Ryder has had a sale / leaseback program in place for a variety of years,” stated Holland. “It has been a bit sluggish. I feel they only dusted it off.
As well as, Navistar Worldwide (NYSE: NAV) Monday started to supply a one yr free guarantee, assured by the manufacturing unit For engines and aftertreatment methods on 2018 and newer fashions on the highway Worldwide LT and RH.
Money disaster: sale-leaseback might assist struggling fleets keep solvent
Know-how-enabled used truck trade-in might enhance highway security
When will truck producers really feel the sting of the semiconductor scarcity?
Click on for extra FreightWaves articles by Alan Adler.