How Leases Can Help Fleets Regain Control Amid Uncertainty
Fluctuating freight demand, changes in federal regulations and shifts in capacity can create uncertainty, and many shippers are turning their attention in-house and establishing private fleets.
The Need for Reliability
The top reason companies operate a private fleet is to provide exceptional levels of service. It also allows them to control their costs and have greater control over their supply chain, according to the National Private Truck Council's 2024 Benchmarking Survey. Greater control is especially helpful when capacity tightens. Many companies that turned to leasing due to capacity constraints during the pandemic have kept their in-house fleet. According to the NPTC study, 72% of respondents indicated that capacity was more available in 2023, but private fleets continued to expand.
Fixed Costs
Freight rates fluctuate as capacity shifts. Leases allow companies to take advantage of a set cost for their equipment as well as its maintenance, making it easier to budget. What's more, they can flex up or down based on surges in demand. Penske can handle all of its customers' transportation needs, allowing them to focus on their core business functions, whether that is manufacturing, selling or delivering products to their customers.
The Right Equipment
Penske Truck Leasing works closely with companies looking to establish or add to their in-house transportation resources to ensure they get the best vehicle for the job, one that works within their budget and is sized for what they're hauling. Penske can examine historical data to understand routes, capacity, drivers, and freight, ensuring everything is covered. Penske draws on that data and works with original equipment manufacturers (OEMs) to build a truck for optimal performance and fuel efficiency that meets its customers' exact needs. Penske can also help its customers increase brand awareness by offering custom painting, decals, graphics and lettering.
The Driver Shortage
One of the challenges for trucking companies is finding drivers to fill seats. This is particularly difficult for over-the-road, for-hire fleets, while private fleets have much better retention levels. In 2023, private fleets reported that turnover averaged 20%, the National Private Truck Council (NPTC) said in its annual benchmarking survey, which is much lower than the 90% turnover average in large truckload fleets.
The average retention rate reported by NPTC members is 9.5 years, and private fleets typically offer drivers better home time, contributing to their retention rate. NPTC reported that at private fleets, 65% of their driver population is home every night, 15% are out overnight and 20% are out two nights or more per run. Many drivers seek out driving positions that allow them to spend fewer nights on the road.