FORT LAUDERDALE, Florida — More fleets are acquiring new trucks by leasing and shortening their asset lifecycles before replacement, according to an annual survey released today by Fleet Advantage, a firm specializing in truck fleet business analytics, equipment financing and asset management.
In 2015, 22 percent of fleets said they were operating their trucks on a 3- to 5-year lifecycle, with the majority being five years. This number jumped to 48 percent this year with 12 percent on a 3- year lifecycle, demonstrating a move to shorter lifecycle operations, Fleet Advantage stated. The percentage of fleets operating trucks on a 6- to 8-year lifecycle fell from 44 percent to 32 percent.
In 2015, 68 percent said they experienced a consistent increase in fuel economy with 2011-2015 model year trucks. This year the number jumped to 84 percent for model years 2011-2016, according to the company.
“Because of its proven impact on lowering fuel costs, as well as service and repair, it’s not surprising to see a large jump to short lifecycles combined with leasing for private fleet operators and for-hire carriers,” said Brian Holland, president and CFO of Fleet Advantage. “Fleets that shift to a shorter asset lifecycle quickly see these gains to their operational bottom line, and our business intelligence platforms are crucial in helping other fleet professionals see the value for their business. We believe the results of this survey validate the shift that has already taken place in the industry.”
The key factor driving this shift, Holland said, comes from understanding economic vs. functional obsolescence and the costs associated with fuel, which has historically represented nearly 70 percent of the total cost to operate a truck. Fleets that operate on a 3-year lifecycle see a per-truck savings over 10 years of $17,040 from those operating on a seven-year lifecycle, he added.
In addition to shorter lifecycles, leasing activity is on the rise, Fleet Advantage reported. In 2015, 20 percent said they leased their trucks. This number more than doubled to 48 percent in 2016. Procurement of new trucks via leasing went from 36 percent in 2015 to 48 percent in 2016. The industry is opting for shorter term leasing with the percentage of fleets trading in vehicles increasing to 40 percent from 22 percent. This, according to Fleet Advantage, provides more flexibility when managing equipment and upgrading to new trucks every three to five years.
The 2016 fleet survey also showed fewer fleets using full-service leasing, with the percentage of fleets dropping from 18 percent to 4 percent, Fleet Advantage stated. Other key trends showed fleets driving vehicles for more miles. In addition, 40 percent of respondents listed maintenance and repair as the largest motivators for truck replacement next to improved fuel economy, versus just 26 percent in 2015.
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