Post by dieselpower on May 13, 2009 9:22:31 GMT -5
Used Trucks Outlook Turns Gloomy
Maritime News
John Gallagher
May 13, 2009
Ryder System downgrade reflects slack demand
Used truck pricing is still down “double digits” year-over-year with no sign of improving due to overcapacity in the truckload market, according to a Wall Street analyst.
“Oddly enough, we believe it could be even worse, if some lenders were not so accommodating with carriers right now on the finance side,” said John Larkin of Stifel Nicolaus. “The longer the lenders let the capacity remain in the marketplace, the longer it should be until we see better pricing in the truckload sector, in our view.”
Larkin’s assessment was made in a report downgrading the stock of truck fleet leasing and management company Ryder System, which has a large used truck network. Revenue and profit at Ryder fell 22 percent and 88 percent, respectively, in the first quarter compared with the same period in 2008.
Despite the outlook, the investment banker noted Ryder will benefit from a long-run trend to outsource private fleets as engine emission standards tighten and maintenance gets more complex.
“In the near-term, however, the market should remain challenged at least into 2010,” Larkin said.
Contact John Gallagher at jgallagher@joc.com.
Maritime News
John Gallagher
May 13, 2009
Ryder System downgrade reflects slack demand
Used truck pricing is still down “double digits” year-over-year with no sign of improving due to overcapacity in the truckload market, according to a Wall Street analyst.
“Oddly enough, we believe it could be even worse, if some lenders were not so accommodating with carriers right now on the finance side,” said John Larkin of Stifel Nicolaus. “The longer the lenders let the capacity remain in the marketplace, the longer it should be until we see better pricing in the truckload sector, in our view.”
Larkin’s assessment was made in a report downgrading the stock of truck fleet leasing and management company Ryder System, which has a large used truck network. Revenue and profit at Ryder fell 22 percent and 88 percent, respectively, in the first quarter compared with the same period in 2008.
Despite the outlook, the investment banker noted Ryder will benefit from a long-run trend to outsource private fleets as engine emission standards tighten and maintenance gets more complex.
“In the near-term, however, the market should remain challenged at least into 2010,” Larkin said.
Contact John Gallagher at jgallagher@joc.com.