Economy's Pickup Lifts Truck Sales

A surge in purchases across South Florida indicates business owners are gaining confidence.

December 14, 2010

Truck sales are up for nine straight months at the nation's largest retailer. And while you may have no interest in buying a pickup, you should care that other people do.

Considered the workhorses of small businesses and contractors, trucks are an economic indicator almost as important as housing starts and unemployment figures.

"Truck sales have always been a driver of the economy," said AutoNation spokesman Marco Cannon. "It's a key bellwether."

At the Fort Lauderdale-based company, sales have increased each month since March between 18 percent and 59 percent when compared with 2009. Improving sales of trucks and vans indicate that business owners feel comfortable enough with the trajectory of the economy that they're willing to invest, Cannon said.

In November, every major car manufacturer in the U.S. except Mazda reported an increase from the previous year in its light-truck sales, which include pickups, SUVs and minivans. The month before, trucks outsold cars by the highest margin in nearly five years, according to industry tracker J.D. Power and Associates. These light trucks made up 54 percent of all U.S. vehicle sales.

Nick Mohnacky of West Palm Beach is one business owner who decided to invest in a delivery van, his biggest business purchase yet. Mohnacky started his custom surfboard business in August 2009, but it wasn't until two months ago that he felt ready to sink about $24,000 into his custom-wrapped van, which he considers a form of mobile advertising.

Before he shelled out the money, Mohnacky didn't do any heavy research into consumer confidence scores or read economists' predictions about when the economy would recover. An uptick in business at Enoch Surfboards told him that the economy was improving enough to make the investment, he said.

"The demand wasn't there a year ago," he said.

Along with small-business owners who might invest in new pickups or vans for their companies are the regular folks who are confident enough in their jobs and finances to take on beefy SUV payments.

Earl Stewart serves the latter group at his North Palm Beach dealership, buying RAV4s and Highlanders. "We're seeing the economy come back, and we're seeing sales in general come back," he said.

While many business owners are still tacking many more miles onto their odometers than they did in flush years, the reticence to buy a new truck or van is beginning to thaw in South Florida, said Shawn McDermott, South Florida regional sales and service manager for Ford. Total truck sales across all brands were up 4 percent in the nation during November, he added, compared with 17 percent in South Florida.

One reason that numbers have risen so much more in South Florida is that they fell so much further when the construction industry dried up, McDermott said. "We have a lot of ground to cover to get back to where the volumes used to be," he said.

McDermott remembers when the biggest payload some of his clients' trucks ever carried was their golf clubs. Those days are over, he said.

But that means the numbers are a better indication of the real state of the economy for business owners and contractors, who McDermott said make up most of his customers. One in three trucks sold in the region is a Ford, he said.

Dealers also are offering incentives to nudge waffling business owners to buy now. For example, Al Packer Ford, which has locations in West Palm Beach and Royal Palm Beach, is offering up to $10,000 off the manufacturer's suggested retail price for a 2010 F-150, depending on the model and equipment, said Gary Weil, general sales manager.

"The pent-up demand along with the manufacturers' and dealers' incentives have helped fuel this increase," he said.

The Associated Press contributed to this story.

Steady Sales Increase

Pickup truck sales at AutoNation have been up every month since March compared with the same period in 2009.