On-going global supply chain issues prompt upsurge in used forklift demand

With ongoing global supply chain issues leading to longer lead times for all types of new materials handling equipment, Toyota Material Handling UK reports that demand for its pre-owned forklifts is at an all-time high as truck users look to second- or third-life machines to support their fleets.

“With refurbished models available for immediate delivery, we are seeing a significant increase in the number of companies that opt for ‘blended’ fleets – a mix of new and used machines,” says Stuart Reilly TMHUK Rental & Used Director.

He continues: “For example, a customer with a requirement for 30 counterbalance trucks may take delivery of 25 new forklifts and, rather than waiting for the remaining five new trucks to be built and delivered, will prefer to obtain five used models straightaway on a short-term rental agreement.”

The strong demand for used equipment comes at a time when the number of second-life units available to rent or buy is down on previous years across the UK market.

Stuart Reilly explains: “Most facilities where forklifts operate were considerably less active than normal for a period of 18 months or so at the height of the Covid pandemic crisis. As a result, many truck fleets that are now coming to the end of their primary term contract hire period have not been worked as hard as expected, so users are seeking to extend the length of their contract for an extra year or 18 months.

“Fewer returning trucks means a reduction in the number of machines available to enter the next phase of the ‘rental cycle’.”

Because around 80 per cent of all new forklifts are acquired on some form of contract rental agreement every manufacturer or dealer knows that almost every new truck ‘sold’ will eventually come back into the business when it reaches the end of its rental period. This allows manufacturers and dealers to plan ahead accordingly.

But, the unique market conditions that have been created by the pandemic mean that many manufacturers and dealers now find that fewer trucks than expected are returning to be ‘re-worked’ and added to their used equipment or short term rental fleets.

Stuart Reilly believes the current situation could take around two years to resolve and is a potentially significant problem for those manufacturers and dealers that lack scale and significant market share. It will have less impact on the biggest players in the forklift market thanks to the sheer numbers of trucks that they supply.