Updating Your Fleet Equipment

Are you considering updating your company's heavy trucks and trailers? Making updates is a big endeavor, so there are many factors to consider when making your decision. One thing is for certain: there is no right or wrong answer. Needs vary per industry, so the choice really comes down to what is best for your business. Every operation is unique, and every owner looks for different things in their trade-in cycle. However, there are some common items you should consider when updating your equipment. 

Equipment Specification. Make sure the equipment, whether new or used, fits your operational needs and is spec'd accordingly. Is the engine the correct size, the axles appropriate for weight and gear ratio, the frame the correct length, and the fifth wheel able to be adjusted for your trailers and loads? Depending on the freight you are hauling, is your trailer as universal as possible to meet various load configurations and weights your customers might expect?

What Do You Want to Afford? If you are financing a vehicle, you should ask yourself, “What can I afford?” followed by “What do I want to afford?” Remember, the average term of a truck or trailer loan is 60 months, so you should be sure your income is secure for at least the next 5 years. For example, in the case of a farmer, they should determine if the equipment will be utilized enough to justify the ongoing monthly payments. 

Maintenance. The cost of running older equipment is not always limited to mechanical breakdowns and repairs. Unless you have a good maintenance program, CSA violations can also contribute to the cost of operation. 

Warranty. Manufacturers are providing some substantial warranty options on new trucks—many coming standard with 5-year or 500,000-mile warranties. Businesses who need larger fleets are buying trucks in bulk, sometimes saving $10,000 to $15,000 per truck. They run these trucks up to 380,000 miles and can still get a good trade value as their vehicles will have 120,000 miles of warranty remaining. 

Fuel Economy. Almost two decades ago, getting 5 or 6 miles per gallon was considered good, with some trucks getting 4. Truck technology has changed significantly, and some fleet applications are claiming to see 8 miles per gallon from their fleet. 

Driver Satisfaction. Professional drivers today have many prospective employers—especially those with years of experience and a clean MVR. What differentiates your company to attract and retain drivers of this caliber? Nice equipment is often thought to be a part of that equation.

Financing. New model trucks are usually easier to finance and often qualify for lower interest rates. The higher cost of buying new when considered with the lower APR can sometimes make more financial sense than buying used.

Depreciation and Resale Value. Like all new vehicles, trucks and trailers depreciate fairly quickly, so the resale value will drop significantly in the first year. In some circumstances, buying used enables you to recoup your initial investment should you decide to sell the equipment. 

Regulations. Are you in trucking for the long term? If so, consider the required CARB regulations when traveling in some states. This can end up costing truckers $16,000 to $18,000 for compliance on a used truck, whereas a new truck is already compliant.

Alll in all, the choice of whether or not to update your fleet is a big one, so ensure you think it over. It can seem overwhelming when there are a wide variety of factors to consider, so just remember: Acuity has your back.