It’s common knowledge that the logistics industry is currently under-resourced. Hopefully, the effects of the pandemic and Brexit will both reduce over the immediate future.
Even so, all the indications are that the logistics industry will still need to expand. With that in mind, here are some points to consider if you’re thinking about buying an HGV.
Assess the total cost of ownership
Your baseline checklist for the total cost of HGV ownership is as follows:
Upfront costs
- Cost of HGV (plus the cost of any upgrades)
- Cost of financing
- Parking/operating base
- Insurance
- Road fund licence
- Transport Manager CPC (NOT Driver CPC)
- Truck operator’s licence (O-licence)
- Assistance to complete O-licence application (optional but generally advisable)
Running costs
- Fuel (save by getting the best fuel card)
- Tyres
- Servicing/inspections/repairs
- Renewal fees for licencing
- Fees for breaching access conditions e.g., the LEZ (avoidable)
If you are going to hire a driver, then you will also need to factor in the cost of paying them.
Realistically, you should be confident that you can absorb the upfront costs and at least three months of running costs before you even consider buying an HGV.
Be clear about where you can get work
If you plan to use an HGV to carry your own goods, then think carefully about whether or not you really have enough work to justify it.
If you plan to use your HGV to carry other people’s goods, then make sure that this is a feasible option. Feasible means not just that the work is there, but that it’s on terms you find acceptable.
There are three key points to check. Firstly, what is the exact nature of the work?
- Is it seasonal or regular?
- Is it short-distance or long-distance?
- Does it cover any places with special restrictions e.g., London?
Secondly, what are the payment arrangements? You need to know both the headline rate(s) and the invoice-processing cycle. You also need to check if there are any reasons why the headline rate might be reduced e.g., if a delivery is delayed.
Thirdly, you need to check if they can offer any extra benefits. For example, a 90-day payment cycle might be acceptable if the company offers a fuel card as well. That way, you effectively get credit for the fuel and pay it back when you get paid. You may also get discounted rates.
Think about the practicalities of owning an HGV
If everything is looking good so far, then think about the practicalities of HGV ownership. In particular, think about where you’re going to store it. This will be checked when you apply for your O Licence. That said, the O Licence is essentially about protecting the public. You need to think about protecting your asset.
Buying an HGV
If, after all that, you’re still in the market for an HGV, then it’s time to get into the details. Your first, and arguably most important decision, is whether you’re going to buy new or used trucks.
In terms of convenience, buying new can sometimes appear to be a clear winner. However it isn’t just that you get a shiny new HGV. You get a shiny new HGV with the latest anti-pollution and safety technology.
On the other hand, most new items carry a price premium just because of their newness (and shininess and convenience). Buying used trucks can be a more pragmatic option and in most cases, used HGVs have plenty of life left in them with many companies completing thorough checks of the their ‘road worthiness’ before they even go up for sale.
You can even grab used trucks for sale at a better cost then new vehicles. If you’re buying from abroad, used HGVs is probably the better route to go down, especially if this is the start of your growing fleet.
When you buy used, however, the onus is very much on you to do your own checks. Here are some of the key points you should look at.
A checklist for buying used HGVs
Euro level
If you want to take an HGV into London, it needs to be Euro 4 for petrol or Euro 6 for diesel. If it’s not, you’ll have to pay a £12.50 daily charge. This scheme may also be adopted by other cities.
A seller should be able to provide proof of their HGV’s current Euro level. If they can’t it’s probably best just to walk away. If an HGV is pre-Euro-4/6 you may be able to upgrade it to meet the current requirements. Keep in mind, however, that the current requirements may be upgraded again in future.
Payload
Can the HGV actually do what you want it to do? Is there any flexibility in case your needs/wants change in future?
Make of truck
Popular brands tend to be popular for a good reason. It also tends to be easier to get parts for their vehicles.
Service history
An HGV’s service history will generally provide a reliable insight into what you could expect if you bought it.
Warranty
The seller should be prepared to warranty the HGV for at least three months. Longer is, of course, better.
Age
The older an HGV is, the more affordable it is likely to be. Part of the reason for this, however, is that it’s more likely to need ongoing care and maintenance. You also have to be realistic about how much useful life it is likely to have left.
Condition
This is separate from age. A new HGV that has been roughly used may be in worse condition than an older HGV which has been well maintained. Pay especially close attention to the engine. It should turn on easily, sound healthy and produce a reasonable amount of smoke.
It’s also worth taking a look at the tyres and interior. Checking the tyres will give you an idea of how long they’re likely to last before they need to be replaced. Checking the interior can give you an insight into how well the HGV has been maintained.
Technology
If you’re planning on taking your HGV into the London area, then you’ll need to make sure you comply with the requirements for the Direct Vision scheme. Even if you’re not, there’s a lot to be said for making use of safety technology. You’ll also be covered if other cities introduce similar schemes.
Always test drive before you buy
There’s only one way to know for sure how a truck actually handles when it’s driven. That’s to drive it. Pay special attention to the steering and braking. Keep in mind that the UK tends to get a lot of wind and rain. These will both worsen any existing issues with handling.
