Profitability can be elusive in the transportation industry. From squeezed load fees from brokers to rising fuel costs, the variables seem endless. It never feels like the right time to invest in a new semi truck or trailer. However, while it seems like every cost is a variable outside of your control, there are some costs which you may very well be able to control. Fuel, maintenance/repairs, and uptime. Of course, I’m talking about taking the plunge into a new truck.
Technology in New Tractor Trailers
While we still have 12-18 wheels, a large diesel block with turbos and similar power ratios to a decade ago, each generation of tractor gains an edge over it’s predecessor. Whether it’s reliability, driver aids, or aerodynamics/fuel efficiency, the technology offered in newer trucks can reduce your operating expenses while you write off the cost of the new equipment. At nearly $200,000 for a fully-outfitted rig, few owner-operators are ready to commit that kind of capital, however for $70,000, you can pick up a 2-3 year old truck with a quarter-million miles on the clock and have most of the latest-and-greatest tricks.
Financing a New Tractor Trailer Is Cheaper
Consider this: while your current rig is fully paid for, it’s in the shop every other month for repairs. Not only are the repairs costing you, but the down time while you wait is halting your cash flow. A loan payment equal to or even greater than your average monthly repair/maintenance bill will likely put you ahead since your tractor will not be held up in the shop while you watch competitors peel load after load off of the load board.
Can I Modify My Truck?
There may be options to modify your existing rig, such as aero kits to reduce drag between cab and trailer, wheel covers, trailer skirts, and trailing domes and fairings for trailers can help reduce fuel consumption by as much as 7%. Depending on your route, this could be as much as $5,000 per year in savings! If this is the route you’re taking, consider if there are other ways to improve your existing rig, or start researching what additional efficiencies a recent used semi truck with newer technology might afford.
Consider a Lease Purchase Truck
If you’re a contractor driving for a larger logistics firm, you may have the advantage of access to better equipment with more generous terms than an independent owner-operator. Investigate your firm’s lease-purchase program.
While getting behind the wheel of a new rig is always exciting, the end goal is to help you be a more successful businessman, and to that end, if you need financing help for your upcoming purchase, contact your representative at ENGS Commercial Finance for a helpful consultation.