THE SHOP

June '19

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40 THE SHOP JUNE 2019 According to the NTEA 2019 Market Forecast and the 2019 Fleet Purchasing Outlook, "We know current economic dynamics like tariffs, the tight labor market, extended lead times and new regu- lations have created complications. Tariffs will continue to make trucks and truck equipment more expensive— largely due to higher aluminum and steel prices. In addition, retaliatory tariffs from other countries have led to supply chain disruptions, which in turn have caused parts shortages. Those types of disruptions are likely to continue in 2019." Junior Calvert, director of national sales at Westin Automotive, says that tariffs have not yet been felt at a consumer level, citing that, at least in his company's case case, 50 percent of the additional costs have been absorbed by Westin, with the rest trickling down the pipeline to the upfitter. "We as the manufacturer are trying to lessen the blow for anyone downstream from us," he says. "If this second round of tariffs goes into place, however, it will be felt (at all levels)." Kevin Fournier of Cap World in Melrose, Massachusetts, confirms the tariffs have already had an impact at the upfitter level, with costs increasing on most, if not all, aftermarket products. "One vendor has had two price increases since October," he notes. "Some of the tariffs are not even in effect yet, so prices could still be on the rise." NTEA also notes that "even with new plant builds in recent years, capacity uti- lization remains high given the workforce shortages," which makes it difficult to staff some plants. And since the labor market will likely remain tight through 2019, some economists suggest the industry may feel the effects into the 2020s. Kelli Kenyon, sales manager – commer- cial truck and van at Keystone Automotive, discusses the impact further. "There is a big, gaping hole in the busi- ness—(a lack of ) skilled tradesmen." It's a domino effect, she explains. "The tariffs cause pricing increases to everything. So, even if we get the jobs back and open factories and start manu- facturing, who's going to make the product (regardless of what it is)?" she asks. "We're short on the workforce. All those people who worked in the steel factories back in the day—they've moved on, and the mil- lennials aren't going to do it." Despite market factors including tariffs and low unem- ployment, the general outlook for the profes- sional vehicle market is extremely strong. (Photo courtesy Apex Tool Group) Restylers and upfitters have ample opportu- nities to provide local small businesses with custom vehicle configura- tions that meet their specific needs. (Photo courtesy Apex Tool Group) Security is important for work truck clients. BOLT Locks allows users to key work truck bodies, padlocks and cable locks to their vehicle ignition key. (Photo courtesy BOLT Locks) WORK IT OUT Keystone partners with Legend Fleet Solutions: http://theshop.ly/keystone-legend

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