Sailing apart

Feb. 21, 2003

Last year, the public and private sectors were in the same boat. Now there seems to be different ideas on how to run a ship.

Last year, the public and private sectors were in the same boat. Now there seems to be different ideas on how to run a ship.

The Roads & Bridges 2002-2003 Truck Acquisition and Maintenance (TAM) Survey shows a market still determined to bring back some old magic through maintenance, but in terms of acquisitions the government and contractor groups seem to be following their own set of orders. State DOT, county and municipal officials are still on the same path of replacing old trucks with new ones. The contractor, on the other hand, has gone from keeping a balance in its fleet to weighing heavy on new acquisitions.

"Look at the housing market," Rob Swim, marketing manager for International, told Roads & Bridges. "The housing market has experienced a boom the last two years, and the private contractors that end up building the houses, making the curbs and sidewalks and building the roads are making the money.

"The other thing is the federal government is giving money to the states for highway construction, but that is normally contracted out to private contractors."

Roads & Bridges' 2002-2003 TAM Survey was sent to a total of 1,987 decision makers in the industry, with participation coming from 261, or a little over 13%.

Buying together

Once again feedback came from high places. On the contractor end 76.3% of the respondents held either an owner or executive position, and 67.7% of government input came from a supervisor or department head.

The complete breakdown of respondents was as follows: contractor 37.1%; state DOT 10.7%; county agency 16.1%; municipality/township 28.4%; toll authority .8%; and other 6.9%..

Last year's survey revealed more of a bond between the contractor and government worker.

Replacement vehicles are where most of the action took place. Of the trucks that were purchased in 2001, 78% fell into the replacement category at the government level, led by Class 8 (220 units, or 91.7% acquired in class), Class 2 (103/81.7%) and Class 1 (97/57.4%). Contractors swiped at a 64% rate, with most falling in Class 2 (134/69.8%), Class 1 (176/60.1%) and Class 8 (78/70.9%).

Only 22% of the buys were actual additions for government sectors. Class 1 was the top addition (72/42.6%) followed by Class 2 (23/18.3%) and Class 8 (20/8.3%). Contractors bulked up at a 36% rate. Class 1 (117/39.9%), Class 2 (58/30.2%) and Class 8 (32/29.1%) were the most popular.

Similar patterns were predicted for 2002 purchases, with both government officials and contractors indicating that around 90% of acquisitions would go toward replacement vehicles.

In the maintenance arena, the government had an average maintenance budget of $702,224 in 2001 while the contractor worked with an average of $125,221. Most routine maintenance was handled at the yard--94.2% government, 83.9% contractor--but both groups turned to the dealer for major fixes--62.3% government, 52.9% contractor.

Buying separately

Predictions sometimes have a short lifespan in the real world, and our 2002-2003 TAM Survey revealed some changes.

Total 2002 acquisitions went as follows: 628 trucks were purchased in Class 1 (167 contractor, 461 government); 369 in Class 2 (89 contractor, 280 government); 109 in Class 3 (47 contractor, 62 government); 90 in Class 4 (28 contractor, 62 government); 56 in Class 5 (22 contractor, 34 government); 43 in Class 6 (28 contractor, 15 government); 235 in Class 7 (16 contractor, 219 government); and 223 in Class 8 (58 contractor, 166 government).

But further breakdown shows a much stronger clash between the two groups. Out of the 1,299 trucks bought for government use, 1,111 (85.5%) served as replacements. Four truck classes led the way--Class 1 (397 units, or 86.1% acquired in class), Class 2 (196/79%), Class 7 (210/95.9%) and Class 8 (149/89.8%).

Contractors, however, only classified 144 (31.5%) of 455 new vehicles as replacements, with Class 8 (32/55.2%) and Class 2 (40/44.9%) coming out on top.

Adding to fleets was the way to go for private businesses, as 311 (68.4%) of the total purchases increased existing inventory. Most went to Class 1 (129/77.2%), Class 3 (30/63.8%) and Class 6 (25/89.3%).

The government scaled back considerably when it came to additions to fleet. Only 188 of the 1,299 acquisitions--led by Class 2 (84/30%)--were additions.

Planned buys for 2003 show contractor action leveling. Those of the private sector surveyed expect to purchase a total of 309 trucks--55.3% additions and 44.7% replacements--with the most coming in Class 1 (118) and Class 2 (56). Class 1 is the top replacement (50/42.4%) and addition (68/57.6%) for contractors. Class 2 (30/53.6%) and Class 8 (33/84.6%) also are top additions for 2003.

The government appears to be satisfied with its current pattern, marking 1,059 (86.8%) of its 1,220 planned acquisitions as replacements. Class 1 (394/88.5%), Class 2 (188/68.1%), Class 7 (192/97%) and Class 8 (145/93.5%) appear to be replacements of choice. If additions will be made at the government level it will be in the Class 2 (88/31.9%) range.

About The Author: Bill Wilson is editor of Roads & Bridges.