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What operators said...
Page 28
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Neil Rushworth, operations director, Expect Distribution
1 have just ordered all our replacement vehicles for the whole of 2008. Our fleet is managed on a contract-hire basis. With lead times being so long. and to avoid price increases, we have had to orde r the entire schedule for 2008.
We do have an issue in managing expansion because we have to predict now what we will require for the whole of next year in terms of additional equipment. Obviously large new contracts will affect this massively and it will probably mean that unless we want to gamble on what we order we will have to take spot-hire vehicles and live with the long lead times.
Again, if the work involves a contract this is difficult to manage as new vehicles will come 7-8 months after the work commences.Th is also means running vehicles without our livery and identity, which we dislike, and there will soon be a shortage of spot-hire vehicles.
As the lead times get longer we are seeingpanic buying set in and people feeling they have to order now.
We've had three price increases in 2007 from our supplier via manufacturers MAN and Volvo and I know there are at least another two scheduled for 2008. The manufacturers are obviously working on a supplyand-demand basis and arc seeing an opportunity to increase their rates.
Again, it is the haulier who gets squeezed because it is seemingly impossible to pass these increases onto customers. My own feeling is that with this and rising fuel costs we will he seeing more hauliers going by the wayside in 2008.
A Ryder spokesman Lead times can impact on our ability to get full revenue from contracts — ie,someone takes out a contract but we can't charge them until the truck turns up in seven months' time.
We are seeing customers extending contracts and also taking up pre-contract rental until their contract-hire or lease truck turns up. All capital investment in our rental fleet is taken care of a year ahead and the customer is affected more than us by shortage of contract-hire vehicles.
And the rental market has performed very well this year, partly because of lead times.