New Report Reveals 2023 Consumer Trends in Trucking
Discussing trucking industry trends, including buying/selling shifts, changing consumer behavior, and better treatment for drivers.
Episode 295: Join us as we take a look at how the trucking industry has evolved over the past couple of years with Charles Bowles Director of Commercial Truck OEM & Strategic Initiatives at Commercial Truck Trader.
We’ll explore trends in buying and selling trucks, including the pandemic’s impact and current supply chain challenges. Discover changes in the sales environment, depreciation effects, and how dealerships are adapting.
Next, we consider how consumer behavior has shifted as highlighted in a recent report, revealing the growing preference for online research and email communication with dealerships rather than a one-on-one approach. Learn strategies to maintain customer relationships in the digital era, emphasizing the importance of convenience and strong connections.
Finally, we explore changing demographics in the trucking industry, as revealed in the 2023 Commercial Truck Trader Consumer Report. We talk about the increasing number of women and tech-savvy individuals entering the field. We also discuss the importance of better treatment for drivers, improved retention rates, and the rising demand for technicians in the aftermarket and independent service sectors.
Plus, stick around to hear some bonus thoughts from our podcast director.
Links
- CommercialTruckTrader.com
- https://pages.commercialtrucktrader.com/2023trends
- Watch the Video Version
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Transcript of Episode
Jamie Irvine:
You are listening to The Heavy Duty Parts Report. I’m your host, Jamie Irvine, and this is the place where we have conversations that empower heavy-duty people.
If you look at the trucking industry over the last 12 months, we have seen a very dynamic, very challenging situation in the industry. There has been so many factors that are contributing to making this really an unprecedented year in many ways. I’m really excited about our conversation today because we’re going to talk to someone who’s really done some in-depth research on the trends on what’s happening in the truck industry, especially related to the purchasing and selling of new and used trucks and the implications that has on the industry. Tune in at the end of our conversation as well because there’s some great bonus content where our director, Diana Cudmore jumped on the call with Charles and I and we had an extended discussion. If you want to really hear some more great information, just make sure to listen to our episode, but also there’s some great bonus information for you at the conclusion of the episode. Let’s introduce our guest. My guest today is Charles Bowles. He’s the director of Commercial Truck OEM and Strategic Initiatives of Commercial Truck Trader. Charles was instrumental in the launch and growth of Commercial Truck Trader’s position in the industry. He works with top executives at some of the world’s largest companies and often presents at national events as a subject matter expert for our industry. Charles, welcome to The Heavy Duty Parts Report. So very glad to have you here.
Charles Bowles:
Thanks for that introduction. Boy, I sound a lot better than I am.
Jamie Irvine:
Hey, you wrote the bio so I just have to read it. So Charles, as I mentioned in the intro, this has been a challenging year. It’s been dynamic. There’s a lot going on in the trucking industry right now as we come to the close of 2023. We’re recording this right now in mid-November. So how has the industry changed over the last 12 months and what impact is that having on our industry, but maybe on the North American society at large?
Charles Bowles:
That is such a broad question and I love talking about this and I’ve talked to a lot of people about it. Dealers and manufacturers we’re seeing changes that I’m an old man and we’re seeing changes that we’ve never seen before in the industry. When I think of the most significant is the impact of what the pandemic had in terms of how we get our goods and how they’re delivered. I think that’s a big one, but also we’ve also seen a lot of supply chain challenges. We’ve seen inventory challenges and we’re just over the past 12 months, which is to what you just referred to, we’re seeing a tremendous bounce back in inventory on dealer lots on our site, Commercial Truck Trader. We’ve seen inventory grow 48.6% over the same period last year. So a significant growth. There’s still a dearth of heavy-duty new day cabs and sleepers, but we’re seeing a significant number of used units come back on dealer lots.
Jamie Irvine:
So what would you say is driving that trend where we’re seeing so many more used vehicles on dealer lots?
Charles Bowles:
It’s a couple of things. One, sadly is inflation and interest rates. Money is very expensive now, so the small owner operators, particularly spot rates are continuing to drop, are having some real challenge. Well, contract rates are dropping too, so we’re seeing a confluence of lot of challenges for very small owner operators, but also we’re finally seeing a ramping up on the new side, but they’re all pre-orders. They barely hit a dealer lot. These are ones that a business has ordered six months, eight months ago have finally come in, and so they’ve been able then to get rid of some of their older units. But that brings us to that point that we’re seeing a lot of people hold onto vehicles a lot longer. So that’s really good for parts and finance. We see a lot of vehicles that are much older that we’ve seen coming into auction, coming into wholesale and even coming into retail. And so that’s really requiring a lot of additional work on that backend, on the parts and on the service to get ’em up to speed so that they can then resell them.
Jamie Irvine:
So if the supply chain is catching up on new vehicles and the bigger fleets are finally getting those ones that they ordered as much as a year ago, and we also see everything going in the wrong direction, inflation’s going up, spot rates and contract rates are going down. We’ve seen a lot of companies, small ones going out of business, some big ones, and all of a sudden now all of this volume of trucks shows up at all these dealership lots. What’s the sales environment like right now? Is these dealerships just holding a lot of inventory or are a lot of these trucks selling quickly? What’s going on there?
Charles Bowles:
That’s such a complex question. I was at the Used Truck Associations national convention last week in San Antonio, and what we’re hearing is just all kinds of stuff across the board. The biggest challenge we’re facing right now is as the inventory comes back, we’ve got residual values problems. We’ve got people who bought high and ended up, it’s not worth what they paid for it. Some cases, by the time they bring it back from the auction, they may be upside down on some of these. So it’s a real challenge. I think what the smart dealers are figuring out is I need to determine what my specific demand is and go after that. There’s really not a lot of spec buying right now, particularly for used because anything that sits on the lot is likely to depreciate a little bit more than it has. So I don’t think we’ve hit the bottom on depreciation, but first I’m not an economist, but I don’t think we’ve hit the bottom on depreciations and valuations. I think it is coming soon, but we’re seeing more of the inventory come back to the dealer lots, the prices are going down, but we still see demand. So it’s kind of a weird dichotomy of different patterns going on simultaneously.
Jamie Irvine:
And the other thing that people have to remember is in these down cycles, it feels like everything is down, but that’s not always true. There can be specific vocations where there’s still demand and things are actually going up. And so yes, it’s true over the road trucking and spot rates and contract rates are down. So for that particular segment, which is a very large segment of our industry, that’s all down, but there might be areas where there’s trucks can be rigged for different vocations and then there’s demand there. So you’re right, it’s never just a one size fits all situation.
Charles Bowles:
You’re exactly right, and what we’ve seen regardless of the pandemic is dump trucks are like the Energizer bunny that the demand just never goes down. I mean, it’s just crazy how the larger dump trucks, seventh and eights and aides, the demand is always there. We’re also seeing what I find interesting on our site, and one of the interesting points about our site is we have a little more than 3000 dealers on the site with several hundred thousand vehicles at any given time, but we have 2.2 million visitors a month. So we get an idea really of what the demand looks like and what we’re seeing is really interesting. Daycab interest is just exploding, the opposite of what we’re seeing on the sleeper side. The past couple of months, we’ve seen sleepers kind of diminish in demand, but what we’ve seen is a real growth in day cabs, and we measure that by not the amount of inventory, but when somebody searches and they get how, if it’s Commercial Truck Trader or truck paper, wherever it is, and you see search results when somebody then clicks on a specific vehicle, that registers increased intent, and that’s what we look at. That’s a vehicle detailed page view, and we’re seeing significantly higher ones for day cabs than we have in a while. I mean, it’s 28% growth in interest from September to October just in day cabs. It’s amazing. Do you have any insight into that? I could certainly use in my job.
Jamie Irvine:
Yeah, why the interest in day cab? So I mean obviously that is a move away from long haul trucking, so that tells me that there are people that are interested in more regional trucking opportunities, and so they’re looking to get equipment to be able to satisfy that need. And so maybe that is a reflection of, look, the spot rates are down, contract rates are down on long haul trucking. I’m now going to go after a specific vocation in my regional area, and so now I don’t need a truck with a sleeper, so I’m going to look at something with a day from my perspective of being in the industry. That to me, the logic behind that tracks with the activity,
Charles Bowles:
Well, I’m glad I’m going to use that. I’m going to steal that from you. As a matter of fact.
Jamie Irvine:
You only have to give me credit once or twice and then it’s yours.
Charles Bowles:
That makes perfect sense. When we’re talking about middle mile and last mile in terms of demand, we still have enormous demand right now for the delivery sector and the smaller classes of vehicles particularly, that just has not abated and it just continues to grow. We’re seeing everything from the low cab forwards or cab overs to just the conventional medium duty trucks that they’re used for, box trucks or delivery trucks. That demand is continuing to grow as we’re seeing these big shifts in how people are buying now.
Jamie Irvine:
Yeah, well, and the other thing too is long haul trucking, there’s a lot of costs associated with that. There’s a lot of miles, a lot of maintenance, a lot of fuel, different insurance needs. There’s also the different regulations depending on what state you’re operating in. So I could also see if I was a trucker right now saying, look, if I can find a regional opportunity where I have to do less travel, maybe I make a little less total, but I spend a lot less. And so then the net for me is actually income for my family. I can see why that trend is growing because that just makes a lot of sense to me. The maintenance costs and the fuel and everything associated with it is so high right now, and there’s just not enough demand. Like you say, the rates are all down, so it’s just everything’s in the wrong direction. So to me, that makes a lot of sense why people are looking at those additional opportunities to try to find ways of making money, actually making money, not just having revenue, but then having costs that are exceeding that revenue.
Charles Bowles:
That makes a lot of sense.
Jamie Irvine:
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We’re back from our break. Before the break, Charles, we were kind of talking about the volatility in the market in trucking the way that the last few months have gone. There’s so many pressures, there’s so many things that are happening in the industry, spot rates and contract rates down costs at all time high. You were talking about some of the trends in used trucks and where that’s going, but your organization has put together a comprehensive consumer report, and I wanted to talk about that. So you’ve released this report at Commercial Truck Trader, and I wanted to talk first of all about the methodology you use to collect the data, and then we’ll talk about the key findings in this report. So first of all, tell us a little bit about what the report is and talk a little bit about the methodology you used to collect the information.
Charles Bowles:
We collected the information from consumer surveys on the site, so it’s from the 2.2 million average monthly visitors that come to the site and choose to take part in the survey. So that gives us some information that way, and it’s a significant amount of information. In addition to that, we can also watch buyer behavior on the site, and that gives us additional deep insights into it. And it was interesting, the takeaways that we’ve gotten, Jamie, it’s so fundamentally different than what it was in 2019 in some cases, if you’d like, I can just share a couple of the takeaways.
Jamie Irvine:
Yeah, yeah, I was interested in that. So you’re collecting the data from the users on your site. You’ve put together this Consumer Trends report, so there were some very specific key takeaways like you say, that were significantly different than in the years past. Let’s talk a little bit about what those were.
Charles Bowles:
One of the ones that is so fundamentally different is how buyers interact with dealerships now. It used to be that a buyer would almost always go to a dealership or almost always contact the dealership by phone. Now, many, many buyers are doing most of their research online, whether it’s at a dealership website or a third party website like Commercial Truck Trader. But by the time a buyer contacts a dealer, they’ve really gone down that sales funnel. That buyer journey is pretty much cemented at that point. They’ve talked to three or four dealerships or researched three or four dealerships before they’ve contacted the one they’re going to buy from. And what’s different is that the telephone, which used to be such a large part of our business just a few years ago, is now moved aside, and it really is email. Email is the way that many of the buyers like to interact with a seller.
They prefer it even over texting. People are so concerned about things like and we offer phone calls and texting and stuff, but people are so concerned about their privacy or they just don’t want the pressure of somebody contacting ’em back that they use email is that form of getting that additional research without actually having to have that direct one-on-one interaction. And that’s so different than it was just several years ago. And it’s not only in the Class Eights, it’s really in the Class three through sevens. We’re seeing many, many conversations, discussions formulated via email where they’ll talk about everything up to the final price via email, and then they will actually contact the dealership. So they’re really looking for a convenient and hassle-free way of shopping, and they want to do it on their own terms now, which is such a change from the way it was just several years ago.
Jamie Irvine:
In 2019, I spent a lot of time talking about the importance of building out the ability to, you want people to be able to find you, learn about you, have all this content on demand so that they can educate themselves. And I pointed to a McKinsey study that showed that B2B buyers were progressively becoming more comfortable buying larger and larger dollar amounts via a complete digital sales channel with little to no in-person communication with the supplier. And then the pandemic hit. And I think a lot of the people that were holding onto the old way were forced during the pandemic to do it differently. And I think a lot of them realized that there was a big upside to doing it this way. And so in some ways, I think the trucking industry caught up to where the rest of, or not the rest of the world, but other industries had already gotten to by 2019 during the pandemic.
So this is no surprise to me. I believe that most companies, they are missing a lot of opportunity by not creating that easy to access information. You have to provide people with all of the information they need to evaluate their choices and their decisions and make it easy for them and make that content on demand 24/7. So people, they can practically binge watch it if they want to. And then to your point, when they’re ready to make a decision, then they’ll contact you and by the time they’ve gotten there, they’re ready to buy and they already have established a relationship with your brand and your company, your dealership, whatever the case may be. And this is a huge opportunity for many, many companies both on the parts side and on the service side and on the truck side to be able to transform the way they do business.
One of the things I hear about from a lot of people is, especially those that are very comfortable with the traditional way, is they’re worried about not being able to have as close of a relationship with their customers because of this perceived distance that the digital sales channel creates. But that has not been my experience. One of the most common things that happens when I go to a trade show and I meet someone that I’ve been working with online for maybe months or even years, is they give me a hug. You’ve created such a comfort level with that individual over time that when you finally do meet in person, they’re ready to, they already have a relationship with you. What’s your experience been? Does that resonate with you?
Charles Bowles:
Oh, very similarly and given hugs and stuff. I’ve kind of tried to stay away from those, but you’re a really big guy, you can probably put ’em away. But since we’ve all started to work remotely in many situations, our relationships are now built via internet, via Zoom, via all these other methods. And what I’ve seen is it really hasn’t diminished relationships at all. And I know from the work I do, and I work a lot at the manufacturer level, that it is actually such a blessing to be able to just hop on a call via Hangout and actually talk to somebody and do business that way. So I think we’re seeing it throughout different parts of the industry now in terms of a dealership and how they interact with their customers. One of the most important things that we know from empirical data is that buyers aren’t just looking for price. It’s important to post a price, but really they’re also looking for that parts and service. And really it’s that maintenance aspect, particularly on the used side of the business that’s really important to a buyer downtime is just money out of the pocket right away. So when we see the best practices at dealerships, when they’re posting listings for units, they really focus in on several things. One, the vocation or the application or the job associated with the vehicle. Obviously that’s how people search. They search for, they don’t search by brand like you would think they do. They don’t search by make, model so much, particularly up through Class seven. In some cases, class eight, they search for that job or that application, dump truck for sale near me, landscape body for sale, Austin, Texas that way. So in a lot of cases they’re focused on that first and foremost.
But then the secondary things they look for are finance and parts, service and maintenance. They’re really critical. And service contracts are another big part, particularly on the use side of the business that are really important to buyers. So you mentioned something a second ago that goes along with this. If you don’t really have a good presence online, and it doesn’t matter whether you’re on Commercial Truck Trader or truck paper, wherever you are, if you don’t have that presence, you’re going to lose eight out of 10 of those possible people that are out there buying because eight out of 10 have already established a relationship with you and you didn’t even know it with online listings, and they’ve chosen to contact you after that. So those are the people that have made their decision and gone to you. If you don’t post properly online, then you lose eight out of 10 of those potential buyers.
Jamie Irvine:
And my experience has been in our consulting company, we work with manufacturers, and we work with distributors and dealership groups. My experience has been that you confront load the relationship building process that used to have to happen after we physically met. Now you can front load that before you ever meet them in person and they can have this relationship and this desire to do business with you because you’ve done a great job of showing them the value of what you’re offering. And then they finally do meet in person and they’re ready to do business. So it front loads the relationship building, but it also primes people to be ready to purchase and then you can do more deals quicker, which is really good for everyone at the end of the day.
Charles Bowles:
That’s such a good point. The old school way of not putting a lot of information or not putting price and say, well, they’ll call me and then I can work into a program for ’em. They’re just not going to call. When you put on a listing call for price, what you’re really saying is don’t call me. They’re not going to call. And the same thing is true. If you don’t put information about your parts and service department, their hours, the bays that you have. All that information is critical to these men and women who are buying these vehicles because this is their tool and every day they don’t have that tool is a day that they lose money. So when they’re searching and looking, researching through that buying process, it is critical to have that information, additional information other than simply the information about the unit. You want that parts and service, you want your hours, you want all that and finance, you want all that information because that’s how they’re searching for you.
Jamie Irvine:
In one of the other key findings of the report, you mentioned demographics. How are demographics shifting and what are the implications?
Charles Bowles:
I didn’t think in my lifetime I would see that 33% of the buyers on the site were women. I just didn’t think we’d get there that fast. I know there’s a large number of women who are over the road and Class 8 drivers, but a number of them is now really growing, and it is really great to see because it really changes the whole complexion of the industry. It becomes just more open, diverse place, and I think that’s good for everybody. So that’s one of the big ones. Also, we’re seeing in many cases, not necessarily Class 8, but larger classes, vehicles, people are buying for different kinds of uses. I’m not sure why somebody buys a Class six pickup truck, but they’ll buy one. I live on a farm and I have a Ford Maverick pickup, like the smallest pickup truck in the world. And by the way, it took me 10 and a half months to get that thing. When I ordered it, it was the first new truck I ever got. I paid $23,000 for it a year and a half ago. The residual on it now is like $32K. I don’t know what’s going on. This goes back to what we talked about in the first part of this conversation is that the prices are just doing this right now.
Jamie Irvine:
Well, I live in Alberta, and if you don’t have an F250 or larger, you don’t even have a truck in their opinion.
Charles Bowles:
That is funny. Oh man. But it goes back to the other point. I do have a 1995 F-150. It can still climb a tree, but it gets lighter every year because the rust around the fenders just…
Jamie Irvine:
That’s right. That’s right. Well, talking about those demographic shifts, I think it’s very important. And at our company, we are focused on human flourishing. That’s our goal. It’s like if heavy-duty people flourish, then they take care of society and then everybody wins. To see this growth in having women join the industry, that’s a wonderful thing. To your point, we need more of that. Do you think that also because the demographics are shifting and remember too, we’ve got a lot of baby boomers who are going to be hanging it up really soon. Do you think that that’s having some implications on the way people are buying and how these trends are going? Do you think that’s part of the driver behind it?
Charles Bowles:
Oh, absolutely. As you start to look at the complexion of the buyers nowadays, you see a dramatic change. Obviously you’re seeing younger buyers and younger buyers bring with them a whole different skillset and a whole different way of looking at not only how they buy vehicles, but what the professions they choose to be a part of. And in the trucking space that it’s no different. We’re seeing people that have chosen, it used to be many years ago that being an over-the-road trucker was kind of one of the last things you wanted to do because it was a very hard job and you’re away from home so long and it’s physically demanding. Vehicles are much more comfortable nowadays. The companies have gotten the message that we need to treat our drivers better. You’re seeing a lot of those changes, which are bringing a whole different type of person into the industry.
And it’s so welcome because we still have our old school folks like me, and that’s great, but we also have younger, more sophisticated folks. We don’t often, if you’re not in the industry, don’t realize how sophisticated people who drive trucks are nowadays. They have to be very adept at understanding computers. They’re away from home all the time. They’re doing a lot of their business over computers. Their entire dashboard now has got many components that are computer related, and they just have to understand all that, and it takes a special kind of training to get to that point. So we’re seeing a higher level of education in many cases. We’re also seeing a shift to actually more women in it, and we’re seeing businesses treating them better because they understand retention is so critical. And we saw, I guess 2019 on some real challenges getting people to get into the trucking space as drivers because that old connotation of how difficult it is and how it’s just a struggle to do it is really not the case anymore. But we’re slowly seeing that change. That’s a very long answer, Jamie, but I’m very excited about seeing those changes because it’s going to help us grow not only just in this industry, but the nation as a whole, because we’ll have people who are very good at this and very good at logistics, very good at moving things and bringing all kinds of new ideas to the market.
Jamie Irvine:
Well, we’ve just scratched the surface of this year’s consumer report. If people would like to get their hands on a copy of it, what’s the best way for them to do that?
Charles Bowles:
Man, I have a very long URL, unfortunately. It is pages.commercialtrucktrader.com/2023 trends. I’ll say it one more time, and you may have to pause and go back and write this down. pages.commercialtrucktrader.com/2023 trends all one long word thing,
Jamie Irvine:
Don’t worry. We will make sure that the links are in the show notes so people can just do one click and get right to that consumer report. You’ve been listening to The Heavy Duty Parts Report. I’m your host, Jamie Irvine. We’ve been speaking with Charles Bowles, Director of Commercial Truck, OEM and Strategic Initiatives at Commercial Truck Trader. To learn more about Commercial Truck Trader, visit commercialtrucktrader.com, and we’ll also have that additional link that’ll take you directly through to this year’s consumer report. Charles, thank you so much for being on The Heavy Duty Parts report. I really enjoyed our conversation.
Charles Bowles:
And Jamie, thank you. I learned a lot from you today. I’ve got to come back and just listen to this.
Jamie Irvine:
So our episode officially concluded, but after we stop recording, Diana, our podcast director came on and we were discussing these shifts in demographics and we wanted to give you a little bit of bonus content. So Diana, welcome to The Heavy Duty Parts Report.
Diana Cudmore:
Thank you, Jamie.
Jamie Irvine:
You just attended a show in Texas. What was the show?
Diana Cudmore:
So it was the Women in Trucking Accelerate Conference. It was in Dallas at the Hilton Anatol. It was beautiful hotel, and to my knowledge, that was the best attended Women in trucking show that they’ve had so far. Easily over a thousand women were there. And that reminded me of what you had just said, Charles, that 33% of buyers are women now. And that just made me so happy that I was there networking with I’m sure some of those women. And that’s such a huge change. So it kind of got me thinking. There have been a few changes in the industry in the name of efficiency that have made the industry more accessible to women. Just a few that come to mind are power jacks and lift gates, and in the name of saving money, they’ve actually opened up the trucking industry to women. So that was really great to hear that that’s being reflected both on the driver and on the buying side.
Charles Bowles:
Yeah, Diana, what’s also interesting is how truck stops now have changed and evolved. They have dog parks, they have all kinds of amenities that you think about the grizzled old guys that look like me that were doing this before. That’s a whole different thing now. I mean, they’re so family friendly. The truck stops of nowadays are just so different and just they’re so welcoming. And I think that’s also been a response to the fact that we’ve got a different type of driver now. We’ve got people who are family oriented, not that the others weren’t, but we have those that are women that are demanding certain things. We have younger millennials who are demanding certain things. So you’re right. I mean, the shift is always market driven. Nobody does these things just for the fun of it and just say, hey, I think I’m going to be good. Maybe not all the time, but really they are seen by adding a dog park to a travel center, it changes and grows their business significantly.
Diana Cudmore:
You’re absolutely right. There are so many husband and wife teams out there, people who are bringing their dogs on the road and cats on the road. Although I don’t think that any truck stop has a cat park yet. I’ll be interested to see.
Charles Bowles:
I dunno, that goes back to that old expression. How would we herd them into that park?
Diana Cudmore:
You’re so funny. Okay. And then since we’re talking about these changing demographics, it also brought up something else to me, which is that this move away from the phone call in-person thing, you kind of mentioned that younger millennials sort of had a great time during the pandemic, which is that we were relying on websites, on email and less on phone calls and in person to make transactions. Now I’m almost 30 now that the younger millennials are really coming up into middle management, into buying positions. I don’t see that trend stopping anytime soon.
Charles Bowles:
Oh, well, let me ask you a question. Yes. What is your phone number for your landline?
Diana Cudmore:
I actually do have a landline. I just set it up two days ago.
Charles Bowles:
You’re such a rare creature. Why did you do that?
Jamie Irvine:
Just a second before she answers that. I just got rid of my landline after having one for 20 years. So okay. The world has flipped upside down now.
Diana Cudmore:
But it’s not a traditional landline. It’s a VoIP, a voiceover internet protocol landline, and it costs me $3 a month, and I wanted it because my mother lives with me. I wanted to have an actual phone that can ring, and I actually, it came with a real desk phone. I am having a great time.
Jamie Irvine:
You’re just accommodating a baby boomer though, with this decision, right? If it wasn’t for your mom, you wouldn’t have done it.
Diana Cudmore:
Yes, that’s my only reason.
Jamie Irvine:
Fair enough. Fair enough.
Diana Cudmore:
And then there was something else that you had mentioned, Charles. So my daughter’s dad is a truck driver, has been for almost 10 years. So I have personal experience or sort of somewhat personal, indirect personal experience with the industry. And when you said that the interest in day cabs are exploding and sleepers are decreasing, you asked Jamie, why do you think that’s happening? I had two thoughts on that.
Charles Bowles:
Oh good.
Diana Cudmore:
Specifically from September to October, that was when the news of yellow going out of business really permeated the media. And yellow had something like 9% of the market share. So I could definitely see how some fleets are clamoring for day cabs to try and take over their share of that LTL freight. Do you think that that might be a reason?
Charles Bowles:
Yeah, that’s really good observation, and we hope that they do because if those things just push back into the market, man, that’s going to depreciate and decrease the residual values on a lot of vehicles and would just be in that state for several more months trying to work out of it. But that’s a really good observation, Diana, and I agree with you on that.
Diana Cudmore:
And then there was another thing. So when my daughter’s dad was first getting into the industry, he did some temp work, there’s very little temp work happening on sleepers that doesn’t really make sense for those companies to use contract labor. That’s not an owner operator for that. So I’m wondering if with the economy looking as dire as it is, if more companies are going to rely on that temp work for their day cabs and they’re trying to grab some used trucks in order to rely on some cheaper labor on their end, I wonder if that could be a reason.
Charles Bowles:
That could be as well. I mean, yeah, I think that is a possibility. And it’s interesting when we talk about the economy because although inflation is going up and interest is just crazy right now, we still have so many people buying, and even though we saw the reports Target and Walmart, I think their earnings reports are down. They still, I think, beat expectations, but were down, which reduced stock prices and things. We’re still seeing a lot of confidence. People have a lot of confidence. Houses are still hard to get right now because two reasons for that. One is there’s just not a lot of supply. But the other side of that is that people don’t want to sell because then if they have to buy something, it costs more.
Diana Cudmore:
Yeah, that makes perfect sense.
Charles Bowles:
But overall, we still see people going out to dinner. We still see people buying clothes at Walmart. We still see the food line, grocery store or whatever, just has lots of people buying stuff. So it’s kind of interesting how all of these things are so different than what we normally thought of when we look at the economy on a macro scale. And I’m not sure what to make of it other than we just ride the wave.
Diana Cudmore:
And something that, Jamie, if you want to chime in here that Jamie always says is the trucking industry is somewhat resilient to whatever the economy feels like because people got to eat, people got to wear clothes.
Jamie Irvine:
We’re the backbone of society, and especially on the independent service side and parts side, that’s a great opportunity for us when we do go through down cycles because people hang onto equipment longer, then they have to service and maintain it more. So then that creates more demand on aftermarket products and on independent service channels. So that can be very good. Oftentimes we start recovering from a downturn in the economy much faster than the general economy at large.
Diana Cudmore:
Yeah. Well, thank you guys for letting me put in my 2 cents. Fantastic.
Charles Bowles:
No, we glad you did. And if you’re a technician, you’ve got all the opportunity in the world right now in the service industry. I mean, they are clamming. That’s one thing I heard at the US Truck Association meeting last week was that it’s just so hard to get hold of technicians. You guys out there, you are gold.
