America’s fleets have never been so full of older trucks and that reality is driving up the truck leasing and rental business just as it is new truck sales. It is not only about adding capacity, however, or about the need to reduce operating costs. For many fleets, leasing or renting equipment also offers a way to conserve capital for other investments in a recovering market and to lower the cost and risk of testing new technologies.
“This year, people are making buying decisions, in contrast to last year, when they were holding off,” Bill Toerpe, vice president national sales for Ryder, told Fleet Owner. “The rental and leasing business is really growing, too. Companies are using rentals to bridge to the future.”
“Fleet aging is driving the lease and rental business up,” noted Christopher Maccio, director of sales for PACCAR Leasing Company. “Our business was up [very significantly] in the first quarter. Our franchises are buying rental equipment to meet the growing demand for low mileage rental trucks. “The growth in rentals is a good early indicator of economic growth. Rentals are great for dealing with upsurges.
“Companies are in the growth mode again,” he told Fleet Owner, “so they often want to conserve capital. That is another reason they are choosing to rent or lease now. It allows them to focus on their core business and use available capital there rather than [tying it up in equipment].
“Replacing old trucks with new also helps fleets to reduce their cost of operation,” Maccio noted. “At the end of the day, every fleet out there is doing all they can to conserve fuel. Replacing old trucks with newer, more efficient ones helps fleets to reduce fuel costs.”
Carriers are also leasing or renting equipment as a lower-risk, lower-cost way to try new technologies. “Leasing or renting equipment gives customers the opportunity to utilize new engine equipment, both SCR (selective catalytic reduction) and ERG-only (exhaust gas recirculation) options,” noted Toerpe. “It also gives them the opportunity to try out alternative power options.”
In March, for example, Ryder announced that the company had ordered 202 heavy-duty, natural gas- powered vehicles as part of Ryder’s agreement with the San Bernardino Associated Governments to launch heavy-duty natural gas truck rental and leasing projects in Southern California. The company is also upgrading three maintenance facilities to handle indoor servicing of natural gas vehicles; two will also have natural gas fueling stations. Training for technicians who maintain natural gas –fueled trucks and for drivers of natural gas vehicles is in the works, as well.
Like Ryder, PacLease is seeing a surge of interest in alternative power for trucks, including natural gas and diesel-electric hybrids. “Customers have to find solutions that meet their operation’s needs and deliver a solid ROI,” Maccio said. “There is a new interest in natural gas power, for instance, both LNG (liquid natural gas) for longer hauls and CNG (compressed natural gas) for day cabs and shorter hauls. That’s the thing about asset management. If we are going to maintain a vehicle for a fleet, then we also do some of the learning for them. ------Wendy Leavitt