In an article shared by truckinginformation.com we see a complete “one-eighty perspective” from Peter Nuñez, owner and founder of Nuñez Trucking in Texas, about the joy of buying a new truck.
When considering buying a new truck, the value of your truck or equipment is equal to the value of completed shipments minus the required maintenance and other fixed costs. Without the proper equipment to complete tasks, work will not get done. Those in the trucking business know the importance of buying the right truck because when that equipment does not operate properly, it comes back to affect the growth of the company.
In the beginning, Nuñez, head of 17 company trucks and 30 owner-operators, purchased old dump trucks because they were sold at a better price. He purchased trucks with high mileage and ran them until they hit around 1 million miles. You can imagine these trucks wouldn’t last as long, but buying cheaper trucks proved sufficient for him as this strategy could allow quick turnover, liquidity, and low or no monthly payments. This can help if you are not sure you want to remain in that business for long, or want to make an easy change.
OUT WITH THE OLD
There is a downside to purchasing older and cheaper trucks. They may be sold at a more digestible price, but are commonly not reliable. There is the constant headache of having them break down and being forced into paying for upgrades, which can add up to match the price of buying that same new truck you were avoiding the cost of in the first place. A complete engine rebuild alone can cost $30,000.
IN WITH THE NEW
Now imagine yourself with that new truck you initially thought you couldn’t have. You are the first person to drive it, guaranteed almost no faults or hidden agendas form the sale. Sounds nice but I’m sure the first thing that pops into your head is the looming stress of cost. You might be asking yourself, how will I ever pay it down, or can I buy something cheaper and get the same value. “I don’t need the nicest truck on the market, I just need one that works.” All of these thoughts are valid, but consider the way Nuñez puts equipment purchase into perspective.
“You have to get used to the idea of spending $180,000 for a new truck instead of $80,000 for a used one, … that extra $100,000 is equity that you get back when you trade it in. So don’t think of the cost now, switch it around and think of the increased operation and value that can come from the purchase of a new truck.”
Nuñez also claims, “I don’t want [trucks] over 650,000 [miles] for a 15-liter engine and 500,000 for a 13-liter. Based on my experience, that’s when you have a downhill slope for reliability.”
Thinking critically about the value of a new purchase can save you a lot of headaches, and next time that new 2020 Kenworth/Peterbilt/LoneStar might make more sense. If you still decided to go used, we have some advice on that purchase as well.
SOURCES:
The article referenced in this post: https://www.truckinginfo.com/325689/the-joy-of-finding-the-right-truck
