Without big-rigs, manufacturers would be left with limited options to get their products from one point of the supply chain to the next. Manufacturing and commercial trucking work hand in hand, and when one industry is doing well, so is the other.
Many experts cite new investments in U.S. manufacturing as the driver behind the increased demand for commercial trucks the industry saw in 2017. Will 2018 see the same positive news? Let's take a look at some of the trends and changes many experts predict, and how they could affect commercial fleet financing investments.
Drivers Won’t Be Able to Drive as Much
The Electronic Logging Device (ELD) will be mandated in 2018 to help increase road safety. Carriers will be required to install this device on all of the vehicles in their fleet to track and limit the amount of time drivers spend behind the wheel. After the limit of 50 hours is reached, drivers will be required to take two full days off to rest up for their next week.
This is presenting some challenges for carriers, however. For example, they will no longer be allowed to haul as many loads as before, and the costs to install the ELD could be ultimately passed onto the consumer.
Smaller Vehicles for the Last Mile
With more and more consumers and small businesses buying products online, the industry has seen an increased demand for “last mile” freight hauling. Big-rigs can’t complete these hauls, so most heavy trucking companies will need to find a way to add smaller vehicles to their fleet to compete.
Commercial Trucking Financing
With these significant trends and changes in mind, how will they affect equipment financing? Well, if we look at last year’s numbers, many expect 2018 to remain a profitable year. In December, the industry saw a 37-month high according to research firm ACT. Trailers also experienced a record year for orders with FTR noting 47,000 trailer orders placed in December.
Industry research experts at EDA recently released their list of the most popular equipment purchases in 2017:
EQUIPMENT TYPE - UNITS - BUYERS
CLASS 8 TRUCK - 849,68 - 252,705
MECHANIC - 171,994 - 161,832
CLASS 7 TRUCK - 92,711 - 38,064
CLASS 6 TRUCK - 64,438 - 34,300
SVC VEHICLE BODY - 9,763 - 4,989
CLASS 5 TRUCK - 1,452 - 852
BUS - 454 - 200
CLASS 4 TRUCK - 439 - 303
CLASS 3 TRUCK - 167 - 152
CLASS 2 TRUCK - 137 - 106
Class 8 Vehicles Remain Popular
Class 8 trucks offer a flexible option with heavy towing capacity for most applications, which is why they remain a popular purchase among carriers. December 2017 was a record-setting month, with research from analysts at ACT noting a 37-month high.
2018 and Beyond
The new changes in 2018 will have an impact of the trucking industry, but if carriers can adapt and expand their services and fleets, they should be able to take advantage of renewed investments in U.S. manufacturing. Over 70% of all U.S. freight moves across the country on trucks so the industry won’t see a downturn anytime soon as long as manufacturing remains strong.
