Market confidence eroding, carriers feeling insurance pinch and new resources hit aftermarket

Transcript

 

This was a busy week in the dealer and aftermarket world, which led to a packed and informative TPS Weekly News Roundup. We addressed our most recent MarketPulse quarterly survey and the insights we received from our dealer and aftermarket responders as it relates to their Q2 performances and their expectations for the rest of the year. We touched on rising insurance rates for commercial carriers and how those additional costs could further be squeezing fleets out of truck buying. We touched on LED lights once again, and Canada’s rules around out-of-service lamps. We also highlighted VIPAR Heavy Duty’s new comprehensive training center, Fullbay’s integration of Mitchell 1 repair estimates into its platform and more.

Transcript

Lucas: Hi everyone. Lucas here with your TPS Weekly News Roundup. We’ll start this week with our MarketPulse report, which is our quarterly survey of business conditions in the dealer and aftermarket channels. And as I’m sure you can guess, Q2 was not a great quarter for anybody—but particularly truck dealers. In our question asking ranking business conditions for the previous quarter on a 1 to 10 scale, dealers gave Q2 a 5.05, which was down from a 5.44 in Q1 and is the weakest score we’ve ever had in the history of our survey among dealers. In the aftermarket, they rated Q2 as a 5.86, which is slightly better, obviously, but still not great. Looking out to Q3, dealers expect a 5.25, so dealers aren’t really hopeful for any major change. The aftermarket a slight bump as well to 6.14, but neither channel really expects a quick turnaround.

One of our other questions is look at your business profits year over year for the next six months. And when we asked dealers ‘What do you expect for the next six months?’ 65% expect their profits will be down year over year in the second half of the year. In the aftermarket that’s just 10%. And I think the big change there is just truck sales. As truck sales continue to falter, now as orders are faltering, dealers don’t think it's likely they can replicate some of the success or the stability they had in 2024.

Also, on the topic of truck sales this week we looked into insurance and how insurance rates are really rising in the carrier space and how that’s impacting truck purchasing. Insurance for carriers is up 11% over the last five years and is expected to continue rising in 2025 and 2026. So, not only are carriers in this position where they’re unable to raise freight rates, they’re unable to gain access to more loads because the market is so depressed. Even if they are able to get some loads, their insurance rates are rising at such at such a pace that it’s hard for them to grow at the speed that they want to grow.

Other stories we had this week. We had an update on our LED story and LED maintenance story from last week. This week’s story was specific to Canada and how many diodes can be out of an LED light in Canada before it needs to be replaced. So, we asked that question in the U.S. last week. This week we asked it in Canada and answered that question.

We had a story from VIPAR Heavy Duty, which introduced its new Nucleus Training Center, which is a wonderful resource for really all departments for Power Heavy Duty and VIPAR Heavy Duty members that I think will be really useful for distributors and service providers.

And then we had a story late in the week from Fullbay and Mitchell 1 who have combined their resources the in the Fullbay app to improve the service repair estimate times for Fullbay users. Some really useful tools there that will make service shops run more effectively and efficiently. So, if you didn’t see those stories or you didn’t see some of the other stories — we had more earnings reports, some more stuff as it relates to regulation — go to the website [and] check all those things out.

Have a great rest of your weekend and we’ll see you on Monday. Have a great weekend guys. Thank you.

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