April 2018 Newsletter
New Tariffs on Steel & Aluminum Affecting Auto Industry
On March 8, 2018, the US Government announced a 10% tariff on imported aluminum and a 25% tariff on imported steel (excluding Canada and Mexico). These tariffs will likely lead to increases in the cost of manufacturing many of the trucks, truck bodies, and equipment.
What does this mean:
- Aluminum and Steel surcharges (price increases)
- After Market Equipment quotes that are only good for days rather than the months we’ve recently enjoyed (stricter quote guidelines/expiration dates)
- Longer lead times as raw materials may be back ordered
Various vendors have indicated price increases effective immediately due to the new tariff. The increases are ranging from 10-20% depending on the product line. It will be important to verify the pricing of aftermarket equipment at the time of order placement as the tariff will be an additional cost especially if the quote was created prior to the tariff announcement.
If you plan to order vehicles, we encourage you to place the order sooner than later. It is anticipated that the longer it takes to place an order, the more likely we will see additional price increases and longer lead times.
Fuel Prices Increase Nationwide
The price of a gallon of gasoline increased to a national average of $2.61 in February. Across the 50 US states, California saw the largest year-over- year increase. Per-gallon prices there rose $.52, fueled by strong demand.
In the News: Autonomous Vehicles
Autonomous Vehicles (AV) continue to be a hot topic. Last month, the U.S. reported its first death involving a self-driving Uber. The test vehicle was in self-driving mode with a human back-up driver at the wheel when a pedestrian was struck by the vehicle.
According to the U.S. News, the fatality could hurt the technology's image and lead to a push for more regulations at the state and federal levels.
Last month’s pedestrian fatality has caused the ride-hailing company to suspend its on-road testing program.
Autonomous vehicles with laser, radar and camera sensors and sophisticated computers have been billed as the way to reduce the more than 40,000 traffic deaths a year in the U.S. alone. According to government officials, ninety-four percent of crashes are caused by human error.
Start-up service Udelv made history recently by conducting the first fully autonomous deliveries near its San Mateo, CA headquarters. The 2.5 mile route included multiple stops on public streets. The firm’s custom vehicle is fully electric and has a range of 60 miles. It can accommodate up to 700 pounds of cargo. Udelv plans to test dozens more of these autonomous vehicles in several other states during 2018.
Consumer Vehicle Preferences: What a Difference a Decade Makes
Consider a single model year, and it’s sometimes hard to discern shifts in consumer demand. But a list published recently by Automotive News reveals some fascinating trends in vehicle production between calendar years 2007 and 2017.
Particularly noteworthy in the 10-year view is the rise of crossover vehicles – and the corresponding decline of passenger sedans.
Some prominent gainers include: