Feb 1, 2008 12:00 PM, BY RICK WEBER

Other trends mentioned in the report:

• Effects of driver shortage: “There will be a shortage in the number of drivers with a Class A commercial driver license in the future. The shortage will greatly affect the heavy-duty truck body products because anything under 26,000 pounds does not require a Class A commercial driver license. This means that businesses (such as garbage collection agencies, concrete delivery companies, and towing agencies) will need to either train new drivers or provide them with higher salaries because of their specialized skills. Manufacturers of heavy-duty units will need to determine whether it makes economic sense to build smaller units for the medium or light-heavy market to enable more drivers to be available for all product categories.”

• Hybrids: “Gasoline and diesel prices will continue to remain a factor in all product categories for the future. Businesses have been feeling the pinch and are trying to find ways to save money on their gas expenditures. Some product categories are testing hybrid units at this time, such as refuse trucks and van products. Still, it will be a couple of years before these products will be officially released into the marketplace. Businesses will be interested in these products, but may not want to pay a premium for the new engines unless they are replacing old equipment. For the refuse market, the change would be immediate because these trucks are known to be the least fuel-efficient trucks on the road, due to their constant starting and stopping. Some outside vendors will continue to create alternative fuel powered engines, but it will still not make a dent into the diesel or gasoline market for the foreseeable future.”

• Vans: “The growth in cutaway vans will be due to the increasing use of the Sprinter chassis. Insulated/refrigerated van growth will be from the increase in prepared foods for supermarkets. The demand for walk-in vans will more or less remain stagnant for the next couple of years as cutaways in many cases are replacing walk-in bodies.”

• Dumps: “Companies are building new painting facilities that reduce the number of problems with the EPA. These new paint booths are not cheap, but they have improved the quality of the body before it is upfitted to the chassis, to a point where there are almost no defects. This provides a longer-lasting unit for customers, because damaged paint invites further deterioration of the body. Without the paint, the aluminum or steel of the body directly interacts with rocks, sand and gravel, which can damage the metal permanently and eventually force the body out of use. Higher-end steel such as Hardox 450 has been entering the market. As raw material prices have increased for aluminum and steel, higher-end steel products have been an attractive alternative for the regular units. Even though these units are more expensive, they are more durable that the other units. When faced with longevity or price concerns, companies tend to choose price, but the durability has shifted the focus to these longer lasting bodies.”

• Service/utility: “Replacement demand for utility/service trucks has been particularly strong in the recent past, spurred by new emissions regulations and improved quality of equipment that reduces operating costs. Further key underlying growth indicators are investment by the utility, service, and telecommunication industries. Going forward, the latter two industries are expected to continue to be the subject of heavy capital outlays to service growing power demand and telecom needs. Service trucks, on the other hand, are equally important at the small business level service industry typified by trades such as carpenters, plumbers, electricians, and contractors.”

• Flatbeds: “The demand to a large extent depends upon the activities in the construction industry, since the product is predominantly used by them for transportation of construction items. It is also common for these units to be used with agriculture, so any growth in agricultural production will lead to more of these units being sold. Furthermore, with such an inexpensive product, demand needs are easy to meet, because for this product all you need is a pick-up truck chassis and a body to match the chassis specs.”

TOP MANUFACTURERS

Top manufacturers of the top five body types in units:

• Vans (127,880): Morgan is the top player, followed by Supreme and Utilimaster.

• Dumps (85,735): TBEI, which owns Crysteel, Heil, J-Craft, Ox Bodies, and Rugby, holds the top four positions in production. The combined production market share for TBEI accounts for roughly 31% of all dump trucks produced in North America.

• Service/utility (70,975): Knapheide was the leading producer, followed by Stahl and Reading.

• Flatbeds (35,385): Morgan is the top player, followed by Supreme and Knapheide.

• Tank trucks: dry bulk, liquids, and gases (11,215): Walinga Corp, based in Canada, leads, but it manufactures only tank truck bodies for hauling dry bulk commodities such as grain, feed and seed, and does not manufacture products in the other categories in this segment. Ledwell & Son Enterprises, second, manufactures dry bulk tank trucks used for hauling feed, as well as water tank trucks. Amthor, Trans-Tech, and Heil International round out the top five.

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