2022 is likely to be a record year for both trucks and trailers. However, despite order books being full, many heavy vehicle OEMs are still struggling with supply chain disruptions and the rising costs of raw materials.
It is for this reason, that Morris has been searching for a new, innovative, way to help OEMs during these turbulent times and through HVIA, are proud to offer a new, exclusive finance product.
Morris are equipment finance specialists; we know that lead times for many are out past 12 months making pricing uncertain and risks high.
With material supply challenges, rising electrical, fuel and shipping costs as well as general economic uncertainty, this is causing a lot of concern and stress for OEMs and suppliers.
This new product challenges the otherwise conventional process, but we believe OEMs can no longer operate on a handshake and carry the risk.
Desperate times indeed calls for desperate measures.
Our solution is a finance approval that treats building a truck or a trailer the same as building a house.
We lock in the deals, and the OEM is provided with progress payments during construction at regular intervals.
These progress payments defray the normal risk that the manufacturer carries in our industry and is designed to alleviate cash flow difficulties.
It helps with component purchases and supply costs.
The purchaser also benefits. They get certainty and can carry on business with confidence. Longer lead times mean more customers must seek additional finance approvals, as the original one lapses between order and delivery.
But not with this product – finance is approved and locked in and progressively drawn down.
Is there a downside, you ask?
Well, there is a small additional cost for the purchaser of servicing the loan as it is drawn down, but we believe this is insignificant compared to the equipment purchase price and is justifiable given the addition certainty, peace of mind and reduce red tape.
This product is optional and voluntary, this is not an OEM forcing new payment terms and your client, this is an independent finance product that is there for the client that has been designed as a win-win.
I have been working in the transport industry my entire working career. I believe one of the strengths has been the enduring friendships I have made across the journey.
I love the fact that we operate largely on a handshake, but as good as this is, I also want the industry to be sustainable.
Recently I have heard stories of trailer OEMs being stuck with highly customized equipment which has been forfeited due to an inability to complete the transaction.
At the recent round of HVIA State Committees, there were several stories from HVIA members who are unhappy and concerned about taking risk during these uncertain times.
I have often said that the heavy vehicle and building industries closely follow each other. I am in dismay at the number of builders defaulting and going into liquidation.
Granted there are varied reasons for this, but they too are in a strong market.
I would hate to see this happen in our industry and I genuinely believe this is a solution that alleviates risk for OEMs, whilst providing certainty for the client.
If you are interested in hearing more or starting your application, Nick VanRooy, will be able to assist you.
Contact Nick today on 1300 4 MORRIS or email@example.com.
This is a special HVIA Partner editorial by Rod Cunningham, GM Sales, Morris.
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