Wreckers' profits slump
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• Profits in the vehicle recovery industry are plunging and most heavier trucks are being operated at a loss, claims research organisation CIFC.
Recovery vehicles are becoming dearer and many operators fail to take depreciation — or wear and tear — of their old vehicles into account. A truck which cost 27,000 a few years ago could cost 225,000 to replace, says CIFC's Harry Palmer.
Palmer told members of the Association of Vehicle Recovery Operators that profits in the industry were a totally unacceptable return for long hours and heavy investment.
Up to 60% of heavy recovery vehicles made a loss, and in many cases an operator's smaller trucks subsidised the rest of the fleet, said Palmer, whose company surveyed a sample of recovery firms. These heavier vehicles needed to do 13,120km a year to break even, but many did less than 8,000km and overheads could not be covered.