Navistar executive Jim Hebe is no stranger to making headlines or being controversial. The two tend to go hand-in-hand and Hebe has seemed comfortable with both his entire career.
His latest headline-grabbing remark that long and tall is “dead and gone” has no doubt raised more than a few eyebrows among owner/ operators who still love their long-nose conventionals.
According to the senior vice-president of North American sales operations for the continent’s Class 8 market share leader, we’re in a whole new world. The classic long-nose conventionals that were the envy of many owner/operators, not to mention fleet owners looking to attract drivers, accounted for 25% of Class 8 sales back in 2000.
Their market share has since dropped to less than 6%. And, according to Hebe, the long-nose conventional is about to be placed on the endangered species list. To be honest, the only thing I find shocking about Hebe’s comments is that it has taken this long to come to this conclusion.
Think about it:Trends such as the growing use of intermodal options for longer hauls, the smaller but more frequent shipments necessitated by online retailers and municipal governments getting pretty ornery about not allowing large trucks near their city cores are serious obstacles to the long-term need for long-nose conventionals. But beyond that, trucking is an industry that operates on thin margins compared to many other industries and even other transport modes such as rail.
One of the most volatile and damaging costs for trucking is fuel. Yet long-nose conventionals are the biggest fuel guzzlers around. The only way for a carrier to be able to justify having such vehicles in its fleet is if it could truly pass on all fuel costs to its clients. And we all know shippers are getting too smart for that to happen.
Many carriers, of course, used to justify adding long-nose conventionals to their fleet because of the impact that had on attracting drivers. I say perhaps it’s time to re-evaluate what kind of drivers we want to attract. Are people who care more about chrome than fuel efficiency really the best people to grow your company with?
You may be able to tolerate them during the boom times but I sure as heck would not want them on my bus when times get bad.
So that leaves the owner/operator as the hardcore buyer for long-nose conventionals into the future. But a new rig depreciates at about $30,000 a year. As Hebe pointed out, how many finance companies are going to be willing to assume that type of risk with a single individual in this kind of economic environment? Traditional buyers of such equipment I’m certain will have trouble getting financing.
The long-nose conventional has been an icon in our industry for decades. But its time has come and gone. It may have taken the outspoken Hebe to say it; but I think most people in this industry can agree with it. •
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