Regulations, efficiency, corporate consolidation, and recruiting talent are among core issues facing the service truck industry.
From evolving regulations to natural disasters to generational shifts in the workforce, change is unavoidable across the service truck industry.
While that’s always been a reality, some industry experts say we’re in the midst of a particularly complex time — just as we were about a decade ago when the Great Recession altered the shape of the economy.
Keith Norbury
Doug Ferguson
Doug Ferguson of the Reading Truck Group (left) and Steve Ditsious of Reading Truck Equipment check out a Caseco service body at the Reading stand at ICUEE 2017 in Louisville, Ky. Pennsylvania-based Reading Truck Group acquired Oklahoma-based Caseco Manufacturing Inc. in January 2017. Reading itself was bought by Texas-based J.B. Poindexter & Co. Inc. in December 2015.
It’s a topic two leaders of the National Truck Equipment Association were scheduled to tackle head on at the NTEA’s Executive Leadership Summit in Chicago in late October. Speaking in advance of the summit, NTEA managing director Doyle Sumrall said political shifts and uncertainty around regulations in Washington, D.C., along with the looming threat of another economic slowdown — and a handful of recent natural disasters — mean it’s a good time to be nimble and ready to react to change.
“We’ve got all this stuff going on that certainly impacts the industry,” Sumrall said. “And so it’s about how you sort through that, what’s your best path?”
In their presentation, Sumrall and NTEA executive director Steve Carey refer to a “dynamic industry” that’s constantly moving and reshaping to stay relevant.
Energy efficiency finds its own life
One key consideration at the moment is whether or not the tightening environmental regulations that have dominated the last decade will continue on under a U.S. president who has pledged to loosen them.
“We see a real change coming from government agencies who are unsure about their budgets,” Sumrall said. “Each one of the key governmental organizations — transportation, energy, the EPA — all have shifting priorities.”
But as the business and technology communities wait for direction, Sumrall said it appears the momentum around alternative energy sources and more efficient vehicles has taken on a life of its own. From big companies like Daimler and Ford to smaller, independent operations, many businesses have formed new partnerships with energy and cost-savings in mind.
“Those organizations have continued and in fact have stepped up in a number of ways,” Sumrall said. “All of a sudden you can say that with a long-run strategy for, perhaps, emissions compliance, it’s not government pressure that’s driving them.”
Doyle Summerall
“You don’t meet with anybody in almost any industry, and certainly not in the truck equipment industry and don’t get into the conversation about the need for qualified, talented people who really want to work. It’s a core issue.”— Doyle Sumrall, managing director, NTEA
Perils of ignoring innovation
For many in the industry, Sumrall said, the push toward innovation is happening outside of political debates about pollution and climate change. In many cases, it comes down to efficiency and smart business decisions. Electric drive systems in trucks, technology to help reduce engine idling, and other innovations are starting to become status quo.
Industry players who opt to ignore those shifts may end up doing so at their own risk, regardless of the direction from Washington, D.C., he said.
“We’re still focused on making the most efficient and productive products and operations we can, and we’ve learned a lot,” Sumrall said. “All that stuff showed real productivity and efficiency gains, and that’s not going to go away.”
Meanwhile, the recent barrage of hurricanes in Texas, Florida and elsewhere has stressed the service truck industry in a way Sumrall expects will linger long after the initial cleanup is over.
With such widespread devastation, Sumrall said he expects a considerable amount of equipment was damaged and will have to be replaced. Meanwhile, service truck operators from across the country have been called upon to help out with their equipment and talents, adding a different kind of strain.
“Given the order of the magnitude of damage, that’s years of effort,” Sumrall said. “It’s not going to be six months.”
Ready for a silver tsunami
An even longer-term trend is a new type of consolidation happening among a number of players in the industry. Sumrall pointed to several large firms, such as J.B. Poindexter & Co. Inc., that are building up their truck equipment portfolios. (Pointerdexter, which already owned Morgan Corporation, acquired Reading Truck Body in December 2015, for example.) Other companies, like Palfinger, have honed in on a sharper focus. Palfinger recently sold its service body business to Reading but kept its Pal Pro Mechanics line of crane bodies.
And running through all of the industry’s shifts is another constant challenge: building up and holding onto a steady, qualified workforce. Sumrall said the service truck industry, like many others, is bracing for the “silver tsunami” of retirements as baby boomers leave the workforce over the next few years.
“You don’t meet with anybody in almost any industry, and certainly not in the truck equipment industry and don’t get into the conversation about the need for qualified, talented people who really want to work,” he said. “It’s a core issue.”
He himself has more than 30 years experience in the work truck industry. Before joining the NTEA, Sumrall held leadership roles with body maker Stahl/Scott Fetzer Company and liftgate manufacturer Waltco Truck Equipment Co.
Sumrall said NTEA is among the industry groups trying to tackle the problem with new efforts around employee retention and recruitment. He said all business leaders should be thinking about how they can help expand the workforce.
A More Positive Light
“Whether you’re an upfitter or a company that makes the bodies and equipment, we’re all in that manufacturing pool,” he said. “Not only are we competing for the talent with everyone around them, but we’re also in a place where you need to partner to build this grassroots groundswell of people to come in.”
Sumrall is supportive of recent efforts to promote positive change in the industry, including highlighting its shift away from being “dirty, dark and dangerous.” He said more focus on the variety of new technology in the industry — and using hands-on simulators to help showcase it — can make a big difference.
“It’s critical we stay informed, and that you get engaged,” he said. “That’s the path forward. If you’re passive about this, you’re going to be second in line.”
Erin Golden is a journalist based in Minnesota.
