Contractors Fuel Surge in Big Pickup Sales

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According to CNW Research, an automotive marketing research company, the percentage of pickup truck purchases by contractors (aka the construction industry) has risen more than 50 percent during the first half of 2013 for the first time since the mid-1980s.

CNW has been collecting data on pickup truck sales for several decades, breaking down the sales into five major categories: appearance, contractor, fleet, RV tow and farm/ranch. During the last 10 to 15 years, the numbers in each category have been relatively stable, with the exception of appearance. This category reflects more of a lifestyle choice, or "cool" factor, rather than being based on a specific requirement an owner might have.

The most dramatic change in these categories comes when examining the percentages from 2001, when the appearance segment reached its highest numbers, to the present. Through much of the early 2000s, at a time when full-size pickup sales were quite high, there were many consumers who seemed to buy pickups for "nonfunctional" reasons. Those numbers fell into single digits by the end of the decade and are still below 6 percent for the last six months.

The contractor category, however, started at more than 50 percent in 1985 and is just now getting back to a stronger position. Typically the largest percentage of the five groups listed, the construction industry looks like it's ready to get back to work with the help of new pickups on job sites.

It's also worth noting that the RV tow category directly maps what the RV industry has gone through during the last 15 years as well. When times are good and pickup truck sales are strong, the RV industry — especially the camper trailer manufacturers — has a much better time. So far, that end of the economy is still sluggish.

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I guess I fall more into the appearance catagory, I don't need a truck but prefer to drive one.

This relates to some of the independent contractors I know driving 10 to 16 year old heavy duty trucks. Both are in the market now for new trucks. High mileage, rust, and increased maintenance means they are ready to replace their trucks.

I'm not sure that I'm buying their statistics or perhaps anyone who goes to Home Depot 3 times a year is a contractor?

If you add up the "work categories" of Farm/Ranch, Fleet, and Contractor, you get a total of 88% of pickups are used for work.
Lifestyle purchases for Appearance and RV Tow are 12%.

It makes no sense.

@Lou and Jeff S
I have read that borrowing in the month in the US has increased $20 billion.

The article stated most money was put onto credit cards and vehicle purchases.

Also, the way the figures are written might have something to do with taxation.

I know in Australia a personal vehicle can't be claimed on your tax return for any expenses, but a business vehicle can.

We are in the midst of another run-up in housing prices and this time it's because investors and bankers are manipulating the market for homes and rentals. As a result many media reports now claim that housing is strong and construction will take off. We'll see about that.

If you're a contractor, try to get another year out of that 5 year old truck. Just like the peak in gold prices last year, this housing boom will be short lived.

Or, if you just want a new truck--go get one! Interest rates are pretty attractive and it's summer, so the dealers are ready to haggle.

@papa jim
I would like to see unemployment in the US fall. This is needed to increase wages and increase inflation. This will reduce the inflationary effect down the track, ease the burden so to speak.

Inflation will come, when it does the US will be in for a shock. All that Fed money sloshing around the economy at the moment locked up in bonds etc. And don't forget the foreign countries that bought US dollars. They will one day start off loading the currency.

China looks like it might need some funds to continue on with its expansionary plan. I heard it will sell USD, I hope they do so responsibly. Europe isn't out of the woods by a long shot either, well neither is the US, but it's the best of the worst.

It's good to see vehicle sales increase, but like most things the money is borrowed. I read that sales are required to be over 17.5 million units per year in the US to bring it up to pre-GFC levels, sales have a little longer to go.

@Lou- not sure where you are, but there are some huge regional variations. In the Midwest, and West, there are definitely a huge number of recreational/lifestyle purchasers. Along the east coast that number dwindles considerably. In a large, busy shopping center in Baltimore this past April, I could have counted F/S pickups on one hand.

I would LOVE to see that broken down by manufacturer. Talk about troll fodder for years to come if any particular brand had a majority of the "lifestyle/appearance" market.

I fall into three different catagories myself.

@Big Al

I don't think the HD truck story, esp. the Big Three is all that global. Falling gold prices is another thing, though.

During the last year, casual investors who bought gold took an awful beating. Gold is sharply off of its 2012 highs and the cash redeemed by the smart guys who got out of that market ahead of gold’s tumble has simply been moved into real estate, and other commodities.

That won't last. Housing remains a difficult proposition for most American families.

New home construction is most places is very soft, especially considering how low mortgage rates are. One out of every five homes in Florida is empty today. That's a huge inventory that will take years to fix.

As long as interest rates for small business loans stay in reasonable territory, HD trucks will probably see steady growth in sales. But, I'd still get another year out of that old HD truck before buying another.

The possibility that business loan rates start heading up would be the only good reason to buy today, in my opinion.

Most who buy HD will use trucks in a business. Few HDs are used as lifestyle vehicles unless it is to tow with. It would be interesting to see statistics for the percentage of full size half tons used for business purposes as compared to HD.

@Big Al--There is a tax advantage for the independent contractor, farmers, and businesses to write off their trucks (depreciate). Anyone who runs a business is more likely to buy an HD truck and an HD truck for the most part will be used in business. I have an independent landscape supplier that buys at least 1 new King Ranch F-250 a year and depreciates it off as a company truck. He has the name of his business on it. He also has a fleet of Kenworth trucks to haul mulch, topsoil, gravel, and rocks which he refreshes every couple of years. He lives in a very nice house and he seems to be doing very well with all the new subdivisions going around in my area (nice guy and a hard worker). He has a lot of cash coming in so I doubt he finances any of his vehicles. My farmer and landscaper friend uses his F-250 for his business and has an old Geo Prizm to use for personal use. I would say he probably will pay cash for his new truck when he buys one.

I realize the guys I know are not necessarily the norm on a national scale because many borrow to buy their business trucks, but I live in a very conservative area which was settled by Germans and the frugality is more of the norm than the exception.

@Mr Knowitall - I live in Northern British Columbia Canada. Even when I've been in larger urban centres, I'm surprised by the number of pickups. Perhaps I'm not considering large metropolitan centres with 5 - 10 million people with high population densities.
In my part of the world, pickups are extremely common. Almost every household has a pickup or mid sized SUV. That tends to be more due to the harsh climates as I rarely see 1/2 ton trucks used for work or back country recreation. 3/4 - 1 ton tucks tend to be the domain of the contractor or industrial worker out in the bush. Most 1 ton duallies I see are recreational Tow rigs. It is rare to see any as work trucks since the machinery used in my region or even some of the parts are too big for a 1 ton truck to haul or to have much of a life span hauling on gravel roads. 1 1/2 ton and larger trucks are what I see as service trucks.

Regardless of where one lives, I seriously doubt that only 12% of pickup truck sales are to lifestyle buyers.

@PapaJim - I do fear that we are still falling into the trap of living on borrowed money. In Canada the Federal Government has slowly been tightening rules on borrowing to ease risky buyers out of the housing market. It is a double edged sword. If one tightens up the access to borrowed money too much it will hurt a country's economy but if one doesn't tighten up borrowed money, we will end up repeating 2008. Except this time around it will be much worse as various governments are already heavily in debt.

@Big Al, @Lou...

Pickups as they are today is an all new phenomenon. When I was a boy if you owned a half ton, you were either a farmer or a home builder. Vans had not yet become mainstream. Station wagons were really big utility vehicles that large families used because in those days many women did not drive and Pop was the family chauffeur. My folks didn't become a two car family until I was an adult. Ditto for color TV.

Today's truck buyer wants a specialty vehicle. I started buying vans and trucks back in the 1970s instead of cars because they were rugged as hell and you could actually work on them without a bunch of specialty tools.

Of course, papa jim, that's no longer true.

The SUV has become the station wagon of today while the pickup truck has become the SUV for many (not all) people. The simple fact that I see so many pickup trucks where I live dressed up as sports wagons, so many with their beds covered by a hard tonneau that makes them totally impractical for hauling, shows that the surge of "Appearance sales" definitely had an impact and still demonstrates that while their replacement for Appearance's sake has faded somewhat, quite a few are still nothing but boy toys. After all, 6% of a hundred thousand is 6 thousand and that's not even one brand's total sales. If, as some here like to crow, there are some 2 million trucks sold in this country each year (personally I think that number is exaggerated) that would mean that some 200,000 trucks each year are nothing but toys for their owners.

Now, as a certain commenter claiming to be from Denver has so clearly pointed out, toy trucks are a fad and will forever be useless to REAL truckers. Hmmmm. If he's right, then exactly HOW many compact/mid-sized trucks actually sold during the '70s and '80s when they were at their height and how many full-sized trucks will sell in the '20s and '30s when that fad ends?

@Lou, Papa Jim, Jeff S, Vulpine, actually anyone,
It's the same here, I read thisweek that 70% of Ford and Holden ute buyers are buying sports/muscle car utes, V8s.

Most Japanese midsizers are 4x4 dual cab mid-high spec as well. SUV are selling quite well. The Japanese pickups are 90% diesel, even though diesel here is priced like it is in the US. Mainly families, 4x4 enthusiasts, and trades/farmers are buying the diesels. But there are a lot of young guys opting for diesel and not V8s.

I can see the day when V8s here become a novelty. Also, we are seeing towing increase by the average guy with these newer diesel utes, they can pull a lot more easier, like the US V8s.

The Ford and Holden utes aren't the best tow vehicles, they just can't compete with the new midsizers.

What these larger vehicles have done is reduce the market for Holden Commodore and Ford Falcons. Small cars are increasing as well.

Vulpine our equivalent of appearance buyers of pickups are our V8 Holden and Ford utes guys. They have the same attitude as the fanbois on this site. If its imported its crap, if if its less than 8 cylinder and doesn't burn petrol its crap.

It's funny how different countries really have the same.

@Papa Jim,
Once the Fed also slows down the printing presses interest rates will go up like stated.

Increasing interest rates will increase the value of the USD. This I think is one of the reason why Detroit are complaining about the Japanese devaluing its currency.

The USD up and the Yen is on the way down.

But during the GFC did anyone care that the Australian currency increased in value by over 50% against the USD.

Not many, so Detroit and the US will have to live with it, like we did and the Canadian's to a slightly lesser degree.

c.6% for appearance last year and this year? forgive me if I am inclined to doubt that. Maybe 6% of the people who bought trucks were actually honest about why they were buying one but I dont buy that for a second. I know a lot of people who buy F250 etc for "work" when work involves hauling themselves and a briefcase to their office. Or "contractors" that probably dont even gross 50k a year in income from their business. I see tons of them every day in my parent's neighborhood. Some dude who figured out how to start an llc, bought one of those 5 piece dewalt tool kits with his King Ranch, Denali, Longhorn whatever, shiny chrome, some ranch hand bumpers, a sky high lift, maybe some semi wheels with the pointy lug nuts, and like an 18" drop hitch ball just so they can still hitch up to the tiny single axle trailer they haul around. Yep a real business vehicle.

The only "work" I have seen with people who buy them here is the same thing. Basically a "Lifestyle Vehicle"

My subdivision is full of newpickups and I never see any doing any work. I think if you haul a couple bags of mulch home once in a while people consider it a work truck.

@RobertRyan - See that's where the big cultural difference exists. You guys are all work and no play. I mean your trucks. Your trucks serve one purpose and are parked when not earning a hard living. Which is fine, but ours serve many purposes. Besides work: Family car. Muscle car. Off-road toy. Yard sales and other hobbies. Taking friends out to dinner and a show. Running errands. The list goes on and on. Or just showing off.

If you like owning 2 or 3 vehicles when one can to it all, that's on you. Or do you just hate fun???????????????????????

People are trying to hack into Robert Ryan's and my computers at the moment:)

Listen and understand, we are serious.

@Big Al from Oz
When I was on the TTAC site. Guess te UAW was not too happy about the comments.
Noticed the same a lot in the US. Very few people seemed to be using them as intended.

I'll rephrase what I just wrote.

TTAC has been hacked into and MAC addresses are being blocked.

I haven't been stopped yet:)

I also have resources.

@The Small Truck Mafia - I realize you guys have TREMENDOUS self-importance and whatnot, but absolutely NO ONE CARES about a couple trolls from the land down undah.

I read about this happening in a report years ago. Appearance buyers were nearly 1/4 of all sales circa 2004/2005 and had fallen to less than 6% and it's still less than 6% today. This was seen as an opportunity for Ford to swing back to marketing to traditional truck buyers. Hopefully this means we will get more parts and features rated for work.

I'd say most people acctualy buy their trucks for their life style choices, you might argue that you use the truck to haul a camper or a race car but unless that is your source of income then you don't need a truck. However many of us use of vehicles because of the hobbies and passions that we partake in. I drive a ford raptor, because for my hobbies and activities that i participate in I need a large secure area for my shooting gear or ski gear, or mountain bikes, camping gear etc. the only vehicles that meet the need that i have of carrying 4 people and all their gear for these activities are halfton trucks with 5.5 beds or chevy suburbans without the back seat, The tacoma short beds are too small for my ski gear and i have a hard cover to secure my guns and keep my ski gear dry and my bed from filling with snow. When you look at comuter vehicles most are "lifestyle vehicles" to get to work in most places all you need is a little two seater. We are not the soviet union, we have choices in what we do with our spare time and our vehicles reflect that. I think lifestyle buyer is a more apt term than appearnce, i bought the truck that fits my lifestyle but the raptor is one ugly duckling of the f serise family unfortuantly my lifestyle needs to go off road alot or in deep snow, i even have a set of studded tires for the winter. When i took a trip to texas i noticed alot of 2wd crewcab pickups without trailer recivers and only one passenger, those are your appearnce buyer, they are not towing or haulling anything , nor going off road or up to the mountains.

I bought my truck to commute back and forth to work with, and I love every minute of it.

" i bought the truck that fits my lifestyle but the raptor is one ugly duckling of the f serise family unfortuantly my lifestyle needs to go off road alot or in deep snow, i even have a set of studded tires for the winter. When i took a trip to texas i noticed alot of 2wd crewcab pickups without trailer recivers and only one passenger, those are your appearnce buyer, they are not towing or haulling anything , nor going off road or up to the mountains. "

Pretty similar to what people do here. "One Passenger" is pretty common.$file/hilux.jpg?OpenElement

This survey like all surveys are just what the are, a designed question, for a designed answer, and when you look at the automobiles they manuf today, is it any wonder there are so many trucks on the road today? I mean that the trucks today are so much better than "in the day" than the improvement on the auto's have been, sure than cars are comfy, but they have always been like that, now they are just more aerodynamic, more fuel efficient and aerodynamic than ever, but that is all, now that the trucks are also like that, and the fact you have always gotten much more for your $ with a truck! and that will continue if the gov were to get out of the way! at least they are more safer for passengers than ever before, as that might have been one of their shortcomings as apposed to cars. But to have a survey like this is like I said, it asks questions that are designed to give a certain answer and that is all, but the real reason people buy more trucks than cars is simple, you get more for your money! now more than ever! and you can use a truck to more people OR stuff, no mater what your life style is!

Many people do buy trucks for a lifestyle vehicle and most probably never use a truck to its full capacities. As with anything for many this is a fad and they will go onto the next vehicle type such as a crossover, but there will always be a market for pickups. Long term the total market for pickups will be less than it is now but that does not mean that pickups will disappear, it just means that there will be a greater demand for another type of vehicle. There is a lot of pent up demand from contractors and businesses that have held off replacing trucks because of declining business and a soft economy but as the economy improves then these buyers will come back and replace their older trucks. The average age of vehicles on the road is at its highest level in years, and yes some of that is due to the vehicles lasting longer but much of it is due to delaying purchases of new vehicles, but after a while then the older vehicles will have to be replaced.

Here in America, families own two or more cars/trucks for ONE reason--each family member old enough to drive has their own car. Well, when they can afford it. The husband is usually the do-it-yourselfer while the wife is the shopper/family hauler. The kids usually want a 'toy'--something simply fun to drive. As such, a pickup of one form or another tends to be the hubby's daily driver, with a larger SUV the typical second choice. The wife tends to go for either a sedan or smaller SUV for a combination of economy and comfort. Granted, this is a stereotype.

The interesting thing is that right now there are far more SUVs being driven than pickup trucks both in industry and by the typical commuter--unless that industry is based on manufacturing, construction or utilities service. Then it's either pickups or full-sized vans. Delivery services tend to use larger vans such as the Sprinter or Step-Van-styled trucks, but that's beside the point.

If/When compact trucks do return to the States (as I'm sure they will as fuel prices rise again and alternative fuels come into demand) then at least some full-sized trucks will be replaced as will many of the large-to-mid-sized SUVs. The open bed does have an advantage over closed beds since home appliances and furniture can be carried home just as easily in one of those as in a larger truck. After all, not one home appliance is heavy enough to overload even the smallest compact truck ever seen in the US while many are simply too large to fit in most SUVs' cargo area.

What this means is that many of those "work" trucks listed above may be getting purchased for that occasional-use scenario (like mine) but are otherwise used more for appearances sake than for actual work.

@Vulpine--Good observation. I agree I keep my S-10 for the Home Depot runs, picking up things that will not fit in an SUV or a smaller crossover, and getting rid of big bulky items. I don't need a road whale when a midsize will more than do the job. Nothing against those that want a large truck, but not interested.

@JeffS, Vulpine.
It is amazing what one can fit inside a vehicle. I had a Safari for 2 years and it carried virtually everything that any pickup I owned could. The negative was that I had to remove 2 rows of seats. With that being said, it was much bigger than any minivan or mid to small sized SUV. The biggest negative was the fact that the inside smelled like the last load I carried. It was nice if I had made a trip to the lumber yard but not so nice if I had picked up a load of soil, made a trip to the garbage dump, or had my dogs after they were swimming in a swamp.
I'd have to agree with your observations. In my neighbourhood, most driveways have 2 vehicles. A small to mid sized SUV and/or a minivan or a small to mid sized car and pickup. The most common pairing is a small SUV and a truck. I see a range of small trucks to 1/2 ton or 1 ton depending on the size of camper trailer or boat in the driveway or back yard.
The SUV is replacing the minivan. Most of my wife's friends have gone away from the minivan due to the stigma of the soccer mom. We looked at small SUV's but they didn't offer the capacity or versatility of a minivan.
Since I got the crewcab truck, we could get away without a minivan since the truck has the capacity for the whole family, especially vacations. The minivan is nice because it can seat 7 but my truck doesn't give much away with seating for six. There are times when we do need all of the seating capacity for my kids and their friends.
The parts delivery vehicles used for the auto garages etc are mostly small cars. The Ford dealer is using a Transit Connect instead of an F150. Heavy industry obviously used larger trucks. Mostly 1.5 ton and larger.

@Lou, Jeff S and Vulpine,
You will find it is quite similar here in Australia, especially where I live. Also up here V8s are more prominent than down south even though fuel is a lot more expensive.

In Australia that stereotypical SUV/ute and SUV/car family is generally in the suburbs and towns outside the centre of the cities.

Even though some call our dual cabs iddy biddy, most are dual cab 4x4s and are used quite similar to what Lou is using his for.

Even now there is still a lot of kids that have cars when still at high school.

I know even in Europe, SUVs, the smaller ones are selling quite well. When I was in France I saw a lot of SUVs with little diesels in them called Dusters, made by Dacia.

They actually looked okay, sort of RAV4 in size.

@Big Al from Oz - when I was in Vancouver, I saw less trucks. Most garages and driveways are too small. When I was in MapleRidge visiting cousins or in Surrey visiting friends, my truck barely fit in their driveways with my bumper almost right up against their garage door. My wife's cousin/husband owned a small car and an older Jeep Cherokee. Her friend in Surrey had a small SUV and her dad had a midsized car.

In my town, some of the "big city" mentality has taken hold in relation to building houses. Huge monstrosities are built on tiny lots with little room for anything.
I have a huge driveway. I can park at least 3 trucks abreast and park at least 3 rows deep. I have a car port that fits my truck and my wife's van nose to nose and still have a 24x26 garage in the back. I'd go nuts in a big city. I'd love to move into a rural home on an acreage. My youngest wants horses and my oldest son wants dirt bikes and quads.
Maybe one day..... if I pick a winning lottery ticket ;)

@Big Al & Lou--Just got rid of a large leather sofa today, one of my neighbors helped me load it on my S-10. I probably could have put it in a minivan if I had one, but it is very handy to have a pickup. I have hauled some very dirty things and with a bed liner it makes cleanup easy. I usually take a leaf blower or sometimes if it is really bad a power washer. Easy cleanup. Lou my brother had a GMC Savanna that he used to pickup his grandkids at the airport and when he need to haul he would take the seats out, lots of room. I have some more things to haul away when I am off during Memorial week in September. That S-10 has paid for itself many times over.

@Lou--We have those huge houses on small lots as well, they are called "McMansions".

@Lou and Jeff S
We call them McMansions as well. Blocks of land in the cities have shrunk in size and now 2 storey homes have to be built on them. We are moving away from the traditional single storey homes on a 1/4 acre block.

But every yard in the Suburbs generally has a ute a SUV/CUV and small car or two for the teenagers, who walk around with things stuck in their ears looking at their smart phones.

I think there are 730 vehicles per 1 000 people in Australia, which means almost anyone under the legal driving age doesn't have one.

@Big Al--Most teenagers are tuned into their smart phones. We now have a World full of young zombies. What would they do if we had a power failure? On the SUV and crossovers they are definitely the most numerous vehicle in suburbia. The modern equivalent of the station wagon and the mini van. I think we will always have pickups but most suburbanites are trending away from pickups. There will always be a core buyer for pickups just not every Joe will have one.

@Jeff S. - I agree. There isn't the same interest in vehicles that there used to be. I have some new neighbours that are very young, maybe early 20's and out of all of their friends that come over, one has a new F150 reg cab, another has a previous gen F150. The rest have a mix match of vehicles. There is no clear pattern. When I was the same age, virtually all of my friends had trucks.

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