The Changing Face of Australian Truck Procurement

It’s perhaps a quirk of our modern society, but it’s not lost on Original Equipment Manufacturers (OEMs) like Isuzu, that there’s an entire industry built around understanding consumer behaviour. ​ 

Right or wrong, there’s genuine value for certain parties in understanding the data on who’s buying what next and why they are making those decisions. 

It’s about far more than turning a buck as well, especially when it comes to working capital equipment such as trucks. In this world, ‘knowing your market’ is to understand the priorities of Aussie businesses that heavily rely on road transport for a huge range of outcomes. ​ ​ ​ 

Perhaps most critically though, it's about applying this market knowledge to develop and specify products that will lead to the best ‘whole-of-life’ equation for the consumer—ensuring the right solution is applied in the right area, at the right time and for the right result. ​ ​ 

It’s through this lens that Isuzu’s latest The Future of Trucking report analyses the changing nature of Australian truck buyer behaviour and the forces that influence it. ​ 

As we pick-up on developing trends throughout this ongoing research, we’ll have an even better read of the nature of demand in the truck market and what are the current ‘best practice’ approaches to satisfy it. ​ ​ 

Slow and steady

Despite the climate of immense change across our sector right now, the report notes that some things in the truck procurement world remain fairly unmoved. ​ 

Interestingly, the first ownership cycle (first purchase term) of our truck parc (across all weight segments) remains static, with newly bought trucks on the road for an overall average of around six years before replacement becomes a genuine consideration. ​ 

The average age of our national truck fleet also remains much the same as it has for many years, with that figure currently hovering at 14.4 years. Comparatively, in some European countries such as Austria, that figure looks more like six years. ​ ​ 

Of course, our national truck fleet average age isn’t ideal, from emissions reduction technology to fuel consumption, to safety standards and the attraction/retention of drivers. In stark contrast to our friends in Europe and the US, Australia’s relatively lethargic regulatory approach to wrangling emission and congestion reduction plays a key role here, something industry bodies have highlighted for years. ​ 

Whole-of-life 

In the meantime, for the majority of larger fleets, and many smaller operations, the ongoing maintenance, fuel and repair costs (whole-of-life costs) are the immediate factors in procurement decision-making. ​ 

Afterall, trucks are a working tool of trade—a means to an end. ​ ​ ​ 

Our research shows that the single biggest driver of buyer behaviour in the Australian truck parc, bar none, is maintenance costs. This is followed by business growth or expansion and thirdly, the end-of-life (resale) of that piece of equipment. 

These results paint the picture of an extremely smart, business-savvy Australian truck buyer, keenly aware of equipment lifecycle equations and who is looking for a transport partner, not merely a retailer of goods. 

The complete package 

From an OEM standpoint, collaborating with this consumer is about both service and product. 

For some time now we’ve seen the meteoric rise in popularity of turnkey, pre-bodied, ‘ready to work’ trucks as a legitimate solution for a growing number of operators in varied applications across our sector. ​ 

In line with previous findings, this is a trend we can see developing at pace, with the curve continuing to track upwards. ​ ​ ​ ​ 

We at Isuzu might be somewhat biased given our product range. However, there’s a compelling argument for the savvy application of turnkey products into established business models. The key, of course, is ensuring that operations adapt to take advantage of the inherent benefits of these solutions and their whole-of-life efficiencies. ​ 

There will always be the core considerations of payload and load space requirements for any trucking application, although tweaking established norms to better suit pre-bodied products is where tangible business efficiencies can be realised. ​ 

Introducing small changes across multiple vehicles can have a huge efficiency impact. Think standardised pallet dimensions for curtain side freight operations, uniform quick-release latches and lightweight side guards… the list goes on. 

Agreeing to profit 

Increasingly, Aussie businesses are rightly considering these details as part of a broader procurement strategy, but it doesn’t end there. ​ 

The provision of maintenance packages such as OEM service agreements are rapidly gaining popularity at the procurement stage, and for good reason. ​ 

Aussie operators understand the premise of investing upfront in these arrangements, equating to increased uptime, reduced handling and ultimately, better margins. ​ 

Importantly, our feedback tells us that service agreements afford time and energy for many businesses. Time to focus on sales and customer service quality, rather than the mechanics of keeping trucks in operation. ​ ​ ​ ​ ​ ​ 

Where to? 

Unlike the broader automotive industry, buyer behaviour in the truck world is far from a rapidly evolving beast. Our data supports well-entrenched views when it comes to procurement decision-making, though that’s not to say we’re completely idle to the concept of change. ​ ​ 

It nonetheless poses the subsequent question of exactly which direction buyer behaviour will take in the future, especially as we move headlong into an era of new powertrain technology with just about every truck brand in the country soon to have a range of alternate products in the mix. ​ ​ ​ ​ 

The challenge remains then for brands such as Isuzu Trucks—to ensure the most cost effective and efficient solution is put forward, backed by the sort of support a purchase of this nature ultimately demands. ​ 

Challenge accepted! ​ 

Isuzu’s The Future of Trucking: The Way Forward report is available for download here. 

About Craig White (Isuzu Australia Limited Head of Sales)  

Backed by a successful career in passenger and commercial automotive sales, including key accounts with companies such as Michelin Tyres, Craig White first joined Isuzu Australia Limited as Zones Sales Manager for South and Western Australia in 2017, before taking on the role of National Dealer Sales Manager in 2020.  

Ascending to Head of Sales in 2023, Craig utilises his strong bonds with the Isuzu Dealer Network and his broad industry experience to develop and manage the sales functions and strategy for both Isuzu Trucks and Isuzu Power Solutions brands.