Truck and plant: A universal opportunity

Much like the car and van sectors, the truck and plant industry has weathered numerous storms in recent years, with an unsettled market sending ripples out across the industry. However, these known challenges are manifesting differently on the industrial side of the used vehicle trade.

Confidence is lower due to the unsettled nature of the market today. For the road transport business, a sector reliant on high-quality trucks, it faces high borrowing rates and increasing operational costs, combined with lower job rates and declining residual values. Residual values have been particularly affected in the last 12 months, as we begin to see purchase volumes made to keep pace with demand during the Covid-19 pandemic are now entering the used market. On the flip side, we are seeing lower-than-normal sales volumes as some operators are holding onto their vehicles for longer, with new HGV registrations down by 12.1% in Q1 2024. This trend is largely due to rising costs of new vehicles and contract extensions.

While the overarching market outlook may feel bleak, it is easy to get lost among a sea of challenges and overlook the potential this vibrant market holds.

The market will always experience highs and lows, but whether we are at a peak or a trough, there is an opportunity to be found. As volumes drop, prices will increase, and vendors stand to gain better returns on their stock, while volume increases see prices drop, but demand and competition for these vehicles increase.

There is also untapped potential in international exports. Plant equipment is typically universal and can be operated from anywhere in the world. If exchange rates are favourable, the overseas market can be very strong. Further, as 30% of the world drives on the left, including key developing markets, there are abundant opportunities to export trucks to these markets as well.

One consequence of economic challenges is an increase in demand for business restructuring, which can often involve partial or full fleet repossessions. As the demand for this kind of consultancy increases so too is the need for quick turnaround, high-return plant and truck sales. As a business operating in this industry, we recognise the clear opportunity to offer this level of service and deliver real results in little time. 

The auction approach is also evolving. While many still prioritise online sales, there is a real need for a physical offering too, as buyers still value the chance to get up close and personal with the vehicles they’re investing in. This was one of the key driving factors behind our decision to reopen our Gloucester site and we have seen consistent levels of in-person attendance, driving competitive bidding activity. We also see that the market is missing a ‘one-stop shop’ approach for more corporate sellers to help ease the time spent in managing these sales.

As we look forward, there are plenty of reasons to be optimistic about the outlook for the truck and plant industry. Many of our vendors have indicated that Q4 this year will see greater volumes coming through the lanes, which should help to right the supply and demand balance. Meanwhile, late plate products will continue to deliver strong returns due to a lack of availability throughout the year. 

Looking ahead, we’re optimistic about the future for us in this industry. We’ve been a strong player in the truck market for a long time and we’re now taking on a greater slice of the plant market.