By Jennigay Coetzer – First published in Business Day newspaper, 28 January 2011

The buying criteria courier companies apply when purchasing vehicles, will depend on the type of goods they are delivering and the weight and size of the load. Popular vehicle configurations range from half ton pickups to 12 ton trucks, says Stanley Anderson, marketing director at Hyundai Automotive South Africa.

“The longer the distance the bigger the vehicles they purchase for the heavier loads they need to deliver.” He says once they have decided on the configuration of the vehicle they will then look at purchase price, running cost, parts pricing and maintenance criteria, typically in that order.

The cost of parts is important, because certain parts will need to be replaced during the vehicle service due to wear and tear or an accident. Common parts that need replacing after an accident are headlamps, radiators, fenders, bonnets and the tailgate at the back of the vehicle.

Anderson says labour costs vary between about R380 and R450 an hour even between dealers of the same make of vehicles. “Another important factor in the selection criteria is whether or not the brand has a national footprint.”

He says most courier companies opt for full maintenance leasing, or purchase vehicles for cash or on a lease basis and outsource the maintenance. But some courier companies prefer to lease their vehicles or pay cash and service their own, in which case they would just purchase parts from dealers.

Anderson says in the current economic climate courier companies are tending to replace their lighter vehicles, up to one ton, but extending the life of their heavier vehicles. “The pay-off between the cost of replacing vehicles against maintaining old ones needs to be considered,” he says.

However courier companies also have to consider their image, especially when the market is so fiercely competitive. Some are therefore replacing their smaller vehicles when they have done 120 to 150,000 kilometres, despite the downturn, whereas they used to replace them after 200,000 kilometres, says Anderson.

He says the motor vehicle market in general fared better in 2010 than in 2009, including an increase in the type of commercial vehicles courier companies buy. A lot of companies, including courier companies, that delayed buying in 2008 and 2009 bought vehicles last year, and the purchasing interest levels are currently better than ever, says Anderson.

He says the favourable rand exchange rate and the current low interest rates are two of the influencing factors behind the increase in sales. Some dealers are also adding value to their offerings, for example by including an air-conditioner or extending the service plan, without increasing the price of the vehicle.

Another trend is that it is now possible to convert petrol driven commercial vehicles to run on natural gas, which is cheaper and the fuel burns cleaner, says Anderson. He says Hyundai is currently converting a 2.4 litre petrol driven panel van to a hybrid vehicle that will run on natural gas or petrol for a customer.

“With the dual system, the driver would be able to switch to petrol if the gas ran out.” It costs R15,000 per vehicle for the conversion, which would be recovered within a couple of months with the savings on fuel costs, he says.

“We do the conversion locally, then run tests and apply to Hyundai in Korea for approval, so that the warranty is not affected.” For 100 vehicles or more it would be viable for the gas company to set up a depot at the courier company’s premises.

“Sasol has a pipeline that brings natural gas in from Mozambique,” says Anderson.

Jennigay Coetzer is a freelance business and technology journalist with 25 years experience, and she writes regularly for Business Day. She also runs media training and writing skills workshops, and is the author of A Perfect Press Release – or Not?, a guide to writing and distributing effective press releases, an electronic version of which can be downloaded free from her website: www.jennigay.co.za.

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