“Buying used trucks can make good business sense.” -Jason Cluck
Spent some time talking with Jason Cluck, branch manager for Arrow Truck Sales in Elizabeth, New Jersey, and Richard Holmes, a sales consultant who is brand new to the world of trucks. Arrow - a national used truck dealership chain owned by the Volvo Group, which also owns Volvo Trucks North America and Mack Trucks - is in the midst of rolling out a new used truck program aimed at fleets for a bunch of 2005 Volvo VNL 670 tractors.
The upshot of these new offers - a group lease package or straight up sale - is that used trucks aren‘t afterthoughts in the trucking business anymore. The lease deal is for a minimum of five units for fleets in business for five years or more. With the average purchase price of the fleet program truck at $60,750, the average down payment per truck is $1,251.37 with an average monthly payment of $,1,226.00 based on 48 months. Therefore for a five truck package the average total down payment is approximately $6,256.85. Buying one of these used tractors outright costs about $1,249 a month with $10,000 down.
In fact, Cluck told me Arrow tailored these plans - entitled the “Expand your Fleet” program - specifically to appeal to small fleets operating 25 to 100 trucks, as the company feels there‘s a lot more value to be had in used trucks today than many fleets might think.
“We‘re talking about used fleet trucks, with about 300,000 to 450,000 miles on them, that are set up specifically to maximize fuel economy and driver comfort,” said Cluck, a former golf pro from Texas turned truck salesman, who‘s been with Arrow for almost five years now. “They‘ve only used up about a third of their expected life, yet cost half the original price of a new truck. And they are fleet trucks; meaning that they‘ve been on a regular maintenance program for oil changes, tire work, etc. It‘s good value for the money.”
Also, as Arrow is owned by Volvo, they get first dibs on Volvo-brand tractor trade ins - meaning they stand to get the best of the bunch, Holmes told me. “Not only that, we put them through an extensive inspection and reconditioning process,” he stressed. “On average we put about $4,000 into each tractor we get in, making sure they are road ready, so the customer can put them directly into service and start making money with them.”
And it‘s not just buyers in the U.S. that are shopping used trucks more frequently. European buyers are sniffing around used lots in the U.S. as well, as demand for trucks is rising overseas while, at the same time, the Euro is gaining a lot more buying power against the dollar right now. “Russia is becoming a big market in particular, as businesses over there have a ton of cash from the rise in oil prices and are working on infrastructure projects at a growing rate,” said Holmes.
Cluck noted that used truck sales have been pretty steady over the last year in the U.S., as opposed to big drop in new equipment sales - largely because those used vehicles don‘t come with the pricey emission-control technology mandated by federal regulations that went into effect Jan. 1 last year. However, what used truck buyers are really after both of them say is a vehicle with good overall value - one with a low purchase price, good operating metrics, minimum downtime, and good warranty options.
“They want the complete package, not just a truck,” said Holmes, who, despite his relative inexperience in trucking, has decades of hard-won sales knowledge (he once sold a fully equipped ice skating rink to a buyer in Seoul, South Korea - now that‘s a deal you don‘t see very day.) “You may not be buying the cheapest used truck, but you‘re getting one you know that‘s been maintained well and is backed with solid warranty coverage.”
That‘s the other thing going on in the used truck market - more warranty coverage options. Cluck said on this current program, buyers can get up to three years or 300,000 miles worth of coverage through warranty provider National Truck Protection.
“Look, fleet trucks like these may not have all the bells and whistles, but they‘ve been well maintained and are spec‘d for maximum fuel efficiency and driver comfort,” said Cluck. “We can also set the customer up with a variety of financing options, help them get plates and insurance, etc. Like Richard said, it‘s all about giving the customer a complete package, not just a truck. That‘s what‘s moving iron in this market today is all about.”
(And being the consummate salesman, Richard Holmes wanted me to make sure I‘d include his contact information - so here it is, by email at [email protected] or by phone at 1-800-827 7692.)