By Stu MacKay: MacKay & Company
An introductory note of caution: This article was written three weeks before the November presidential election. By now, the winner will have inspired such a sensational burst of confidence in the country and the business environment that all that follows is little more than a history lesson. Should this forecast be accurate, I have a couple of really good used cars …
It certainly appears that we’re a little short of good news these days. There is apparently no realistic bottom to the stock market, both the domestic and global banking markets are imploding, consumer confidence is solidly under water, no one in government has any meaningful credibility left – and that’s the good news!
In our own little heavy-duty corner of this arena, the picture isn’t much better. Truck and trailer utilization rates are tanking, trucking bankruptcies are expanding, equipment is being parked and rumors of cannibalization are increasing.
The only REAL problem with the heavy-duty business today has nothing at all to do with employment, consumer confidence, utilization rates, bankruptcies or anything like this. It is simply a function of geography!
Individually and collectively, we are scrambling to cope with a business situation that is, on average, thirteen time zones out of sync. We are struggling today simply because we are operating on the wrong end of the Pacific Ocean. Where we are is the good ol’ US of A; where we need to be is CHINA!
The current operating universe of heavy trucks in China is (pick a number; nobody knows, especially the government). But this observer’s recent roadside observations would indicate that whatever the number is – it is humongous! The reputed average fleet size is 1.2 rigs. They come in all shapes and sizes, powered by anything from a garden tractor to a legitimate 15-liter diesel. The standard color is blue and color option No. 1 is dirt!
