April 2018 Newsletter

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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.

Top Ten Largest Monthly Changes in Gas Prices: February 5, 2018

National Average Gas Price Comparison, 2015 to 2018: February 5, 2018

Source: aaa.com

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.

udelv Autonomous Vehicle

Source: www.ttac.com

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:

Model 2007 2017 % Change
Grand Cherokee 127,518 272,989 114%
Suburban 156,716 264,829 69%
Ram 1500 410,725 635,930 55%
F-150 509,510 699,814 37%
Canyon 23,210 42,254 82%
Colorado 85,400 129,343 51%
Honda CRV 59,772 463,248 675%
Equinox 105,260 345,593 228%
Compass 67,603 182,698 170%
Explorer 162,575 316,012 94%
Escape 209,774 367,270 75%
Sentra 125,175 283,494 126%
Malibu 130,598 222,201 70%

Source: Automotivenews.com

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