Rusty Rush, chairman, CEO and president, Rush EnterprisesRegardless of industry “headwinds,” Rush Enterprises aims to capture market share, said Rusty Rush, chairman, CEO and president, Rush Enterprises, during a press briefing at the 2019 Rush Enterprises Tech Skills Rodeo in San Antonio.
“You’re coming off of the two biggest years back to back since 2005 and 2006. From a retail sales perspective, it’s going to go backward [in 2020], we all know that, it’s just how far backward is it going to be,” Rush said. “Parts and service are going to be a little more difficult, too, because the age of fleets … are newer.”
Although the supply of used trucks is up because of the volume of new trucks that have been sold in recent years, Rush said the company is in good shape. That said, adjustments have to be made on the used side of the business.
“Evaluations are declining quicker than normal depreciation because this country works off of supply and demand. We have to work ourselves through the supply and there will probably be lower evaluations than folks were getting a year ago for, say, a four-year-old truck,” Rush said. “From an evaluation perspective, we stay on top of it, so I don’t see huge hit coming. We’re valued to market, always. There’s no reason to kid yourself in this game.”
Rush knows what’s coming and not only does he not appear to be phased by it, he says Rush Enterprises is prepared. “We’ve been through all this before — there’s nothing more cyclical than the Class 8 truck business,” he said.
“We’re going to have to continue to stay focused on our strategic initiatives, which will continue to raise our share of the marketplace. Whatever the size of the market, we want more share,” Rush says. “We can’t control markets but what we can control is sales and what we get out of it from an organizational aspect.”
Rush said the company also is prepared for the new breed of trucks running alternative fuels — regardless of what those alternative fuels might be.
“It will be driven by the demands of the segment. Diesel will still be the lead dog 10 years from now. Electric will find its space more on the medium-duty side and around-town side. Hydrogen is maybe 20 years away,” Rush said.
Michael McRoberts, chief operating officer, Rush Enterprises, said there isn’t going to be a single successor to diesel, which will have a place long term but it won’t be what it is today.
“I think CNG will have a place. I think electric will have a place, although electric has the same barriers to entry that CNG had five years ago, even more so: weight, length of haul, cost and infrastructure,” McRoberts said.
“The costs are greater with electric, the infrastructure [in place] is a fraction of what it is in the CNG space. I think you’ll also see hybrid technology, whether it’s CNG and electric or hydrogen and electric. It’s going to be some combination of that,” he said. “We’re probably at least 10 to 15 years away.”
Rush said he believes the OEMs will play in all spaces and reiterated the usage of alternative fuels will be market segment driven.
“We’re going to play in whatever space evolves,” Rush said. “We will be the middle guy servicing whatever technology is out there.”
A few hours after the press briefing, Rush would be handing out awards, cash and prizes to the winners of the Tech Skills Rodeo, an event he said acknowledges the best of the best.
“It’s a reward for the hard work and dedication of the people who strive to get better day in and day out. If we all strive to be the best, then you’re working with people who are the best. The evolution of the organization is driven by the evolution of the employees,” he said.
Not only is the event a celebration of employees’ hard work, Rush said it’s also a recruitment tool.
“There’s no question it’s a part of it. We also provide the best facilities and the best training. The shop is the heartbeat of the dealership,” he said. “When it comes to recruitment, you need to show them respect and what they really mean to the overall dealership. Does [the Tech Skills Rodeo] help? You better believe it does. It’s a piece of [overall recruitment strategy] and something we like to use as a differentiator.”
