Information

Used Equipment Yields New Business

Tampa, Florida - June 24, 2009:  [TAMPA, FLORIDA] June 24, 2009 – Trucks and Parts of Tampa, Inc., is rewriting the used-truck business model to help recession-savvy businesses grow.

As the oldest used refuse equipment dealer in the industry, Trucks and Parts of Tampa is seeing their business grow through customers who are better leveraging their used equipment to maintain current fleet readiness.

“This recession has brought with it lots of bad news, but also opened up several avenues of new business,” said Scott Dols, President of Trucks and Parts of Tampa. “Every business is watching their dollars, delaying their purchases, or not spending at all. But many of our customers now are much more aware of the costs associated with the upkeep of their older vehicles.”

Dols points out that one of the market segments that has grown significantly is municipalities, who are looking to stretch their shrinking budgets while being tasked to maintain fleet productivity.

“We saw an up-tick in business following last year’s rapid rise in diesel fuel prices,” said Dols. “I don’t know of any municipality that forecasted $5.00 per gallon fuel prices, or the speed in which it rose. This took a quick toll on municipal budgets as trash still needed to be collected every week. It didn’t take long for most municipalities to slash funds for new equipment as a means of staying afloat. With so many municipalities running older trucks requiring increased maintenance, our newer refurbished used trucks became a very attractive option with a quick ROI.”

Danville, Virginia, with a population of 46,000, recently looked to Trucks and Parts to augment their fleet with quality used equipment that made financial sense, even though they have weathered the economic storm fairly well.

‘For the City of Danville, it was a simple question of economics,” said Administrative Division Director, Barry Doebert. “We didn’t want to spend $115,000 on new equipment, when something used would work just as well. According to Doebert, the City of Danville recently purchased a used roll-off frame and two grapple trucks to assist with the collection of Danville’s 19,000 homes.

“We bought equipment that was right for the job we needed and at a price that was economically feasible,” said Doebert.

Other municipalities have traditionally looked to Trucks and Parts to provide equipment to be used as spares in the event their front-line equipment breaks down, but many are putting them out on their daily routes instead.

“Our local equipment dealer recommended that we look at Trucks and Parts [of Tampa],” said City of Jasper, Texas Solid Waste Director, Jerry Young. They recently purchased both a used automated side loader and commercial front loader. The City of Jasper is responsible for trash collection for upward of 10,000 homes, so their equipment needs to work. “We needed good quality used vehicles to function as spare units for our fleet,” said Young, adding, “now we’re using one of those units as an everyday truck and it’s working very well.”

Smaller “Mom and Pop” fleets have also felt the pinch, but have historically looked to outlets such as Trucks and Parts as a source for equipment purchases as well as trade ins. Sister company Tampa Trucks and Salvage has also seen business pick up as used components, such as transmissions, engines, and axels are assisting refuse haulers extend the life of older vehicles.

“I think the smaller fleets have been better suited to weather this storm, as they view their equipment as the primary means by which they make their mortgage payments,” said Lex Goldenberg, Plant Manager of Tampa Trucks and Salvage, a division of LKQ. “In years past, when a hauler lost a motor in a rear loader, they were more inclined to replace the entire unit. Now, we’re seeing many customers taking a harder look at replacing the engine, which represents a huge savings over a major capital purchase. Used and refurbished diesel engines represent about 50 percent of our business at LKQ Heavy Equipment,” said Goldenberg.

Both Dols and Goldenberg agree that timing is critical regarding a fleet directors’ balance between new and used vehicles and the economic upturn that is looming somewhere in the future.

“We’re talking to fleet operations personnel at several major fleets regarding cycling their older inventory,” said Goldenberg. “They’re bidding on new contracts that require newer vehicles, but many of these contract has not been awarded yet. Everyone’s watching commodity prices, reading the Wall Street Journal, and trying to hedge their bets regarding when the economy and consumer confidence will return. In the meantime, they’re watching their maintenance spend on the vehicles they’re running a lot closer.
LKQ purchased Tampa Truck Salvage in January of 2009 and resides in the same 30,000 square-foot facility that houses their other businesses. A customer that is interested in renting or purchasing a used truck from Dols is very likely to walk across the office to Goldenberg, to inquire about replacing a diesel engine or transmission for one of his other vehicles, or salvaging a unit completely.

Trucks and Parts of Tampa is one of the companies under the umbrella of Trucks.com, a multi-faceted business that offers used trucks, used truck parts, rental trucks, and route-ready trucks through many well-known web-driven store fronts, such as Big Truck Rental, Route-Ready Trucks.com, and LKQ.com, which specializes in used and refurbished diesel engines. LKQ is a public company, traded on Nasdaq under the symbol LKQX.

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For more information, contact Scott Dols at (813) 247-6637

Trucks & Parts of Tampa
1015 S 50th St
Tampa, FL 33619

U.S. Toll Free: 1-877-999-8782
Phone: 813-247-6636
Fax: 813-247-4465