The way trucking companies get access to the equipment they need to run their business is changing and many are looking at a number of alternatives, looking at trucks, lease of buy? Adrian Beach, General Manager Penske Truck Leasing, reckons the market is moving and adapting to change.
Trucks with the Penske Lease stripes which we see on the road are the trucks on rental terms. However, over the past couple of years, Penske Truck Leasing has really grown its fully maintained operating lease fleet, which will either be plain white or in the customer’s livery. Customers on these longer term deals can customise the trucks and get different configurations like 8×4 rigids, or fitted with hydraulics.
The length of the leases can vary widely from the operator with a two or three year contract to fill or one which needs the truck as long as possible to handle a specialist task.
“Sometimes we have customers that say, they’ve got a two year contract or a three year contract, who are less concerned about the monthly payment, and more concerned about if the customer doesn’t renew that contract,” says Adrian. “Then they just hand these, four or five trucks back to us and they’re done.
“There is quite a wide spectrum of the way that people want their operational lease to work. That’s another way we fit in well with the dealership, so with the rental fleet there, they can try one and use a rental truck as a kind of a demo, they can rent one to fill in for an accident, downtime or peak seasonal needs.
“If they want to do something long term, we can do a fully maintained operating lease, or if they just want to buy it like they may have in the past they can get the positive experience from the rental fleet and then feel comfortable purchasing right from the dealership.”
Developing Business
When it was started, the Penske Truck Leasing business was rental only. It didn’t really go to market with fully maintained operating leases until around 2017. Although the fully maintained business made a little bit of progress, when COVID hit, problems like limited travel and in-person meetings meant that progress with leasing slowed for a couple of years.
In the post-COVID period that side of the business has grown to over 30 lease customers, most of them in Brisbane. There has been more growth in the last 18 months than there was in the previous five years.
“Customers have changed in how they want to use their capital, says Adrian. “There’s a few customers that we’ve signed recently who haven’t gotten their trucks where, internally, the various departments and divisions in the company are competing for capital. In that case, the fleet may need to show what kind of return they can get on this investment. It’s difficult for the fleet guy showed a return.
“A couple of customers are looking to just use someone else’s capital for the rolling stock because they need a new printing press or a new plastic injection moulding machine or they want to build a new shed, elsewhere in the business. They can do something a little more productive with their money.
“I can’t tell you how many smaller fleet customers I’ve talked to who lease their depot but have always purchased their trucks. Own the real estate, lease the trucks. It’s a more effective use of capital, whether it’s a smaller company, like a four truck fleet with a little depot, or a company that actually manufactures something.”
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