By Doyle Sumrall
NTEA Senior Director of Business Development
Throughout my career, I have seen industry cycles come and go. I’ve always been impressed by the companies that not only survive, but actually excel when business cycles begin. I now realize that this does not occur by accident — it’s the result of a planned set of strategies and actions.
In January and February, the NTEA held a series of Midwest regional meetings to address the state of the industry and to share and discuss ideas on how companies can best position for profit and growth over the next year. During these meetings, NTEA staff shared the results of a recent survey seeking fleet professionals’ purchase plans and level of interest in “green” initiatives. Survey results indicated that respondents are still focused on and committed to greening their fleets.
In addition, during recent meetings with fleets, the NTEA learned that fleets want suppliers to incorporate green initiatives in their operations and in the way they build products. Another important factor is using renewable resource components when building products.
Sharing information on your company’s green initiatives can impact whether your firm is selected to supply trucks. For instance, a fleet recently released a solicitation including bodies and equipment installed on a chassis and requested bidders to document the recycled content in their product offerings. This fleet received several responses, but only one company documented the recycled content in the steel body it bid. The solicitation was awarded to that NTEA member.
As another example, I recently visited a major government fleet and learned that it has many restrictions on purchasing equipment as well as a hold on building necessary and approved structures. However, this fleet continues to buy hybrid trucks and pay the premium for the hybrid option. Despite decreased fuel prices, fleets and truck buyers are still purchasing technologies and trucks made from green material and that offer fuel use reductions over the life of the vehicle.
Today, the concept of green trucks and equipment goes well beyond a hybrid drive system or fuels other than gas or diesel. Green can involve offering a configuration that performs necessary tasks and is produced with material that reduces weight. Or, as explained by NTEA Fleet Relations Director Bob Johnson, by selecting the right drivetrain and reducing equipment weight, a work truck that normally gets 10 miles to the gallon can achieve 12 miles per gallon —a 20% improvement in fuel use. Other approaches gaining popularity include auxiliary power units and component electrification. An NTEA member at one of the Midwest regional meetings said they have a PTO-driven generator system that can store power in a battery pack when the engine is running and then power the application from the battery to reduce fuel use.
As you plan your business strategies for 2009 and beyond, remember that people buying work trucks have a long-term vision of ownership. Most fleets and truck buyers plan to own their trucks for seven to 10 years and believe that fuel prices will increase substantially during this time. Therefore, fuel use is still a key consideration as, in many cases, fuel costs exceed labor costs for operating the equipment. This makes hybrids, alternative fuels, weight reduction techniques and other innovative ideas to power work tools important considerations.
There are many emerging products and chassis offerings relating to green work trucks and equipment. The NTEA will continue to keep members informed of the latest developments through articles in the NTEA News and Web site content. Visit NTEA.com for a recap of the Green Truck Summit, Green Truck Ride-and-Drive and green products showcased at The Work Truck Show 2009, held March 4–6, 2009 in Chicago, IL.