Managing Commercial, Public, Utility and Telecom Fleets
3/1/2012 8:00:00 AM

Looking for Momentum: Uneven Growth for Work Trucks


Mark Molesky for L&MT

Despite the persistent weaknesses in the housing, government and some construction markets, growing confidence in the economy along with the pent-up demand for equipment and an end-of-year rush to take advantage of a tax break turned 2011 into a comparatively “decent” business year for the truck equipment sector.

Barring unseen disasters, 2012 is expected to continue that growth trajectory, manufacturing and equipment distributors said.

“It was our best bottom line year in a decade,” said Steven Sill, president of Aspen Equipment Co., Bloomington, Minn., “and the bulk of it was felt in the second half. It’s pent-up purchasing as much as anything.”

Aspen’s business came from equipment sales and upfits for oil recovery, electric transmission and railroad customers, Sill said, adding, “For each segment, there is probably a series of reasons that each one bounced back.”

Furthermore, despite cutbacks on most other equipment purchases, counties and municipalities continued to buy snow-removal equipment, Sill said.

“In spite of budget cuts, it’s a public safety issue. [Governments] can cut back on front-end loaders, but they can’t mess with snow removal,” he said.

Andy Dejana, vice president of Dejana Truck and Utility Equipment Co., Kings Park, N.Y., said the company had a strong fourth quarter as fleets and service sector businesses began replacing aging vehicles.

“We’re at the point now where small contractors and fleet managers are seeing that downtime, maintenance and repairs are costing more money than the monthly payment for a new vehicle,” Dejana said. “[Fleets] have been putting Band-Aids on vehicles for two or three years or longer than they would have kept them and people are comfortable enough that business has stabilized.”

“Fleet people are just starting to get back into acquiring vehicles and they’re buying what they absolutely have to have,” said Robert Johnson, director of fleet relations with the National Truck Equipment Association. “Their equipment is so old, it’s no longer serviceable.”

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© 2012, Transport Topics Publishing Group. All rights reserved.

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