LAS VEGAS – (May 20, 2024) – Fleet Advantage, a leading innovator in specialty financing, fleet data analytics, fleet management services, and life cycle cost management, announced today results of an industry-wide survey to take the pulse on fleets’ life cycle strategies, how many fleets are aware of the anticipated CARB prebuy mandate, as well as their anticipated plans for equipment acquisition over the next few years. The announcement was made at this year’s Advanced Clean Transportation (ACT) Expo at the Las Vegas Convention Center.
Truck procurement and life cycle management continue to be significant topics within the transportation fleet industry, especially given all the focus on the CARB mandate, which is expected to result in the largest truck prebuy ever leading up to 2027, beginning in 2025 into 2026, with the cost of diesel trucks increasing between $25,000 and $30,000 more per unit.
Recognizing the need to shorten life cycles
Fleet Advantage presented an online survey to more than 3,000 transportation fleet executives from April 29 – May 10, with 71% saying they’re operating trucks more than five years currently. When asked how many trucks in their fleet are model year 2019 or older, more than half (62%) said as many as 50 trucks in their fleet fall into this “higher aged” category. Aging inventory is certainly becoming an issue for these fleets, since this percentage was closer to 37% in last year’s benchmark study conducted in August.
More awareness needed for CARB mandate/effect on procurement
Twenty-three percent said they are either unaware of the CARB mandate, or are still unsure about it. Despite most admitting they are running a longer life cycle with the need to replace trucks, 68% are aware that the CARB mandate will result in escalated truck prebuy activity leading up to 2027.
Even though the majority say they are running a five-year-or-more life cycle, 68% also admit they feel it is necessary to replace as much as 50% of their fleet over the next 2-3 years, which means they are now looking to shorten their life cycle. When asked what percent of their fleet they are actually planning to replace, approximately three-fourths of respondents said they actually plan to replace as much as half of their fleet over the next 2-3 years.
While 36% said they have a CARB prebuy procurement plan in place, nearly half (44%) said they either do not have a plan or are unsure if their organization has a plan. This is an alarming revelation that illustrates many fleets are unprepared and could face dire financial consequences in the coming years.
Procurement plans over the next few years
Fifty-seven percent of fleets said they plan to strategically procure trucks in a methodical manner replacing aging vehicles to ensure they are constantly refreshing equipment without overpaying for all new trucks all at once. Nearly 20% of fleets said they will make no change to their replacement cycle, as they will procure trucks no matter the additional CARB prebuy cost. Furthermore, when asked if they are concerned about the affect CARB may have on truck pricing, 23% of fleets said they will just keep the existing trucks they have for a little longer through the next few years.
“It’s imperative for fleets to understand the significant implications of the anticipated CARB mandate,” said Brian Antonellis, CTP, Senior Vice President of Fleet Operations for Fleet Advantage. “Educating fleets about the effects this will have on their procurement plans and their bottom line is important, but it is certainly not enough. Organizations must harness the power of data technology and analytics to establish a modernization plan that prioritizes a multi-year procurement approach. By maximizing total cost of ownership, we not only adapt to regulatory changes but also drive efficiency and sustainability forward, ensuring a smoother journey toward a greener tomorrow and more efficient operations.
About Fleet Advantage
Fleet Advantage is the largest independent lessor for heavy-duty Class-8 trucks and has over $3 Billion assets and over 20,000 units under its Life Cycle Cost Management program. This comprises a client portfolio of more than 50 of America’s top corporate fleets, including five (5) of the top 10 private fleets in the country. Fleet Advantage guarantees the absolute lowest cost of operation by providing fleet asset management, financing solutions, and fleet analytics, using the latest equipment technology to achieve optimum vehicle productivity and maximum safety. Our model of TCO, clean diesel, and safety-enhanced trucks with shorter life cycles complement our customers’ ESG goals. The accomplishments of Fleet Advantage and our leadership team continue to be recognized for tremendous growth and industry leadership with numerous awards, including Top Private Independent and Most Innovative Firm by the Monitor Daily, Top Software & Tech Awards, Top Women Associates in Finance, and Green Supply Chain Awards to name a few. The company has also been named to Inc. magazine’s 500|5000 list of fastest growing companies in the nation.
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