Seismic changes to supply chains, imports and accessing global markets indicative of ongoing COVID circumstances made for a disruptive business environment the likes of which had arguably, in the era of integrated logistics and consumer economies, not been seen before.
Road transport was especially hit hard. Established businesses, as well as new outfits focused on last mile delivery were suddenly confronted with volumes of additional and new business that demanded of them access to new vehicles that only third parties could supply.
Against this backdrop truck hire and leasing businesses came to the fore. Hertz was one of them. Truck rentals in Australia, which thrive on periods of seasonality, typically handle surplus when it comes to fleet customers who, unable to wait for new body builds or delayed overseas shipments, in desperate need of vehicles can turn to the likes of Hertz franchise Australia Truck and 4WD Rentals.
With seven locations in New South Wales, another eight in Victoria and three more in South Australia, where its head office is situated, Australia Truck and 4WD Rentals commands a fleet upward of 4000 vehicles, including light and heavy commercial vehicles, 4WDs, buses and cars.
There are hundreds of Fuso models carried in the fleet. These include Canters, Fighters, Shoguns and Rosas — the full complement available from the brand.
These numbers are always being renewed. Australia Truck and 4WD Rentals just added three new Fuso Shoguns and 13 new Canters to its fleet which has swelled to include 270 units from the Japanese brand.
Later this year, Hertz will have made its 1000th truck purchase from Fuso, according to Paul Jukes Victorian State Manager.
“Because we’ve gotten so big, we’ve virtually got them arriving every month,” he says. “It used to be quite ad hoc how we had our new trucks delivered. Now it’s all planned well in advance in terms of what’s coming off our product portfolio and what’s being purchased. They are constantly arriving every month.”
The business, as part of its model, engages multiple agencies as well. These agencies can provide the trucks to other franchises or to Hertz and they will rent them on their behalf.
“That’s to increase our network and exposure nationally,” adds Paul. The trucks from Fuso, who have been a partner of Australia Truck and 4WD Rentals for well over 30 years, embody the core pillars the business looks for in a commercial vehicle.
Safety perhaps ranks highest. Fuso offers several advanced technologies as part of a suite of integrated features designed to make the driver experience safer and stress-free.
A radar-based Advanced Emergency Braking System that can also detect moving pedestrians, in addition to larger objects, comes as standard as does a Lane Departure Warning System. Reliability, for which Fuso has maintained a stellar reputation, and ease-of-use, are also key considerations for any truck hire business.
“They are a really easy truck to drive and use all round for customers who might have jumped into a truck for the first time,” says Paul.
“Add to that the outstanding customer service provided by Fuso. Post-purchase backup, warranty issues, anything like that, it’s terrific. It’s no wonder our relationship has lasted so long.”
The commercial vehicle stream of the business is divided into four separate segments.
The retail consideration handles one-or-two-day rentals which are commonly associated with small jobs like removals or people moving house on a weekend. The Fuso Canter has proven to be an ideal product here.
There’s a short-term corporate segment that caters to businesses that already have their own fleet but need an extra truck on short notice. Say, for instance if one of their trucks has broken down and they need to replace it urgently.
Mid-to-long-term corporate is a segment in which the fleet needs additional trucks for major demand or perhaps a new contract that might only last 12 months.
Put another way, the work is unlikely to justify the outlay for purchasing their own new truck.
Such an arrangement with Australian Trucks and 4WD Rentals might result in an order of several units; ten or even 20 trucks over a finite period. The fourth segment of the business is its Operational Leasing.
These full operational leases start at 12 months and can typically extend to periods of up to eight years.
“That’s where the vehicle is purchased directly for the customer with their exact spec,” says Paul. “That means we’re not going with our rental spec but we’re going with whatever they want.”
The customer is then given the option to purchase at the end of the contract. Operational Leasing previously was considered a significant part of the business.
However, post-pandemic the other three segments have enjoyed noticeable uptake.
Paul puts it down to more uncertainty in the marketplace with customers reluctant to sign up to long-term leases for multiple years.
“Even though they might have to pay a little bit more they want the flexibility to be able to pick up extra trucks and return trucks when they need,” he says.
“In recent years the industry has endured labour shortages, inflation, and stock shortages to name some of the factors impacting on these decisions as customers prefer the flexibility of the short-term rental as opposed to the long-term. That can be seen a positive or a negative for us. I suppose some of the positives for the rental industry are that customers do seem a little bit nervous to purchase new trucks for themselves because of those uncertainties I’ve just touched on.”
Per the current trend, customers are displaying a preference to rent or lease vehicles from Australian Trucks and 4WD Rentals with an option to return the vehicles if the economic climate or their business circumstances change again.
The 4WD offering in the business name relates more to the Toyota HiLux, a product with a major presence in the market for the company, although it can certainly provide 4×4 trucks. Outside of South Australia these are a niche offering.
Utes are often leased for infrastructure projects in Victoria and New South Wales where road extensions and tunnels have been part of ongoing state government-backed builds.
As these projects can last for three years and longer, leading outfits who specialise in civil and infrastructure works, are subject to surges when a contract hits a certain section of the project.
“They’ve got real flexibility and pick up and return extra vehicles when they want to,” says Paul. “All of the 4×4 HiLuxes that we provide for those large companies have a safety spec — we call it a mine spec.”
It must adhere to OH&S requirements. These vehicles are fitted out with everything from flashing beacons, reverse squawkers, fire extinguishers, two-way radios, wheel chocks, wheel nut indicators, high vis stripes and bullbars.
Naturally, the business over time is well adapted to surge periods. Much of its seasonal work comes from staging and event companies. In Victoria there is the Spring Racing Carnival, Melbourne’ F1 Grand Prix and music festivals.
Traditionally speaking, it ramps up from October onwards through to December including the customary Christmas surge when beverage manufacturers are increasing product deliveries and Tier 1 fleets are taking on more vehicles.
The lull of January and February is offset by additional work through tourism and in March there are often an increase in live outdoor events.
Having been with Hertz for 20 years, Paul can look back with insight on how the sector has changed in that time. He says the safety package Fuso offers is better than what cars once got.
“If you look at the spec on trucks from Fuso it’s a compelling selling point,” he says.
“The afterservice they provide is exemplary. The amount of times Fuso have helped us out and worked things around for us, for example, to change specs at the last minute if a customer changes their mind, it’s great.”
While orders are made by head office in South Australia, who will engage directly with Daimler Truck Australia Pacific, in Victoria Paul deals with Brett Arandale at Fuso Port Melbourne.
“I’ve always dealt with him and he’s been wonderful for as long as I can recall,” he adds.
“They’ve looked after us for so long I’m a real advocate. If I’m at a barbecue and anyone asked me what I do I always mention Fuso.” Paul adds, “They’ve a great company to align with.”
