AmeriQuest president/CEO Doug Clark is forecasting a 15-25% increase in used truck sales and rentals in 2004, based on surveys he took of company owners across America.
Clark says there are three factors at work:
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The economy is picking up.
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Many companies haven't made purchases in the past three years.
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The uncertainty over diesel engines has been resolved.
“Everything points to the economy picking up steam,” said Clark, whose transportation and logistics company provides procurement services, outsourced transportation management services, technology solutions, commercial funding, and logistics consulting to the commercial trucking industry.
“Month over month, activity is getting stronger in used trucks and rentals. We still haven't seen any signs that leasing activity is picking up.”
In the Northeast, he said the rental market has been firming up month over month in the past six months. There's an upward surge in used trucks, particularly Class 8 tandem-axle day cabs. Some concerns continue over inventory, particularly sleepers.
In the Southeast, the picture isn't as optimistic as the rest of the country. He said rentals are “not robust,” used trucks are “mixed,” and lease activity is “stagnant.” Factors at work: the furniture and textile industries are suffering because of foreign competition, and Florida's tourism industry is still hurting.
The Midwest was the strongest of the area surveyed, with the trend up in rentals and used trucks. Lease activity includes more quoting and signing of existing accounts, though new accounts are still reluctant to sign.
He said the forecast for the West is for a stronger year 2004 than this year, with a mixed picture in rentals, a “firm to strong” picture in used trucks and very active lease activity in quoting, though getting commitments is still a problem.
Productivity increases
Clark said that he believes that the surging economy has not produced more jobs because technological advances have increased productivity.
“I'm a firm believer — and I may be out in left field — that it's mostly through productivity that has been put into place through technology over the last three or four years, very quietly and without a lot of fanfare, not like the dotcom era,” he said. “I look at AmeriQuest as an example of this. I've increased our transactions 40% — 11,000 accounts receivable and payable transactions a month, when we were doing about 6,000 at the beginning of the year. We have not added one person. Our whole process is geared toward digitalization.”
His forecast for technology in the next two years: Wireless communication will continue to improve efficiency; tracking of the untethered trailer will grow, improving security; purchases will be digitized without destroying current relationships.
“I'm absolutely convinced that technology, properly used, will benefit everyone,” he said.