Leasing to the Transport and Logistics Sector

leasing to the transport and logistics sector

Founded in New Zealand in 1992, TR Group is a provider of truck and trailer rental and leasing to the transport and logistics sector. 

TR Group is a privately owned company currently employing over 200 people across a network of 15 branches throughout New Zealand and Australia. Services include the Rental, Lease, TR Driver Training and Used Vehicle Sales.

As it stands today, TR Group collectively owns approximately 7,000 heavy transport vehicles and manages an additional 1,500 on behalf of its customers. The business continues to grow rapidly and is constantly evolving its range of services with the goal of providing customers the best options for the short- and long-term hire of heavy commercial vehicles. 

The group made its move into Australia by taking over Victoria’s largest trailer hire business Semi Skel Hire (SSH) in July 2019. SSH was founded by Geoff Kelly in 1994, with his son David and daughter Kim Kelly having subsequently come onboard to help him run the business. Kim and David have stayed on in the respective roles of National Business Manager and National Fleet Manager. 

The company opened a brand-new facility at Laverton North in September 2020, while a further two branches were opened in the Brisbane suburb of Lytton in February 2020 and at Beresfield near Newcastle in mid-2021, giving TR Group a significant presence along the eastern seaboard.

“We have a strong culture based on real values that are not mere generic platitudes,” says Kim. “These values and our culture create a relaxed yet focused working environment for all of our employees.

“We believe in making a positive difference in people’s lives. We do this by creating an environment where people can grow while providing quality products and services that help our customers succeed.”

leasing to the transport and logistics sector

Quality of equipment

In some minds, one of the perceived negatives of renting transport equipment comes from earlier experience where the equipment was often older gear, perhaps not well maintained and with an appearance that screamed out ‘rental’ to everyone who saw it.

As such, renting equipment was often seen as simply a stopgap measure to temporarily replace a vehicle in the fleet that was off the road for repairs, for example. 

According to Kim, those days are long gone and the modern rental and leasing fleets, as typified by TR Group, are populated by trucks and trailers that are all presented and maintained at an exemplary level.

“After our trailers reach their mid-life, we strip them right down, replace all the running gear and repaint them, they literally come up like new,” she says. 

With the topic of speccing the equipment, Kim remarks that when setting up equipment the company seeks the best possible specifications, builds and materials.

“We seek the advice of our suppliers because they are experts in their respective fields,” she says. “We rely on their expertise and recommendations on how our trailers are built, they must be built to last. 

“In terms of maintenance and servicing, we have super strict schedules with safety and compliance being absolutely at the forefront of everything we do. We use genuine parts only and have a nationwide contract with Bridgestone for tyres. We do not compromise on quality throughout the life of the equipment, from day one it is maintained and serviced to manufacturer specification and continues that way until the asset has completed its life in our fleet.”

leasing to the transport and logistics sector

Leasing

Kim explains that while leasing is not necessarily front of mind in Australia, it’s really starting to take off.

“Close to 95 per cent of the company’s Australian business is rental whereas in contrast, leasing accounts for around 75 per cent of TR Group’s business in New Zealand,” she says.

“We’re looking to expand our lease business in Australia for customers who are looking for modern well spec’d vehicles at a fixed cost without the associated maintenance and residual risk. With the added flexibility of being able to add and return fleet quickly through our rental fleet we feel we can provide the ideal solution for our customer’s needs.”

Kim explains that additional positives around leasing are that the customers can have their own specs and transport livery, meaning anything the company supplies will simply fit into their fleet like one of their own vehicles.

“With a fully maintained lease from TR, maintenance costs are fixed for the term of the lease removing the risk of any unexpected major costs or increases in the costs of workshops and parts, which we know is a massive issue in this industry,” says Kim. “Leasing also removes residual risk from a business and quite often can be fully tax deductible. Transport is a tough industry with slim profit margins, so having a regular fixed cost is a great benefit for any company.

Kim mentions that TR Group has expanded its Australian fleet significantly since it commenced operations in 2019. 

“We now have over 1,400 prime movers and semi-trailers in our hire fleet and another 200 new units on order,” says Kim. “Our entire fleet of equipment is Australian manufactured and built, except for the Benz prime movers. We are very focused on supporting the Australian manufacturers with the 200 on order a mix of Barker, Vawdrey and Southern Cross trailers and Volvo, Kenworth, and DAF Prime movers. 

While SSH was solely a trailer hire business, since taking over TR Group has added prime mover and rigid body truck hire and lease to its Australian operations. 

“We saw a real opportunity in the market for prime mover and rigid truck hire and lease. In the last two years we have acquired around 100 prime movers including Volvo, Mercedes-Benz, DAF, and Kenworth units,” says Kim. 

Kim reiterates that the addition of these two categories along with a burgeoning trailer fleet means that growth in the Australian operation has been phenomenal.

“We’ve been one of the lucky ones, with the Coronavirus pandemic driving an increased demand for transport which has made us much busier and even more essential throughout these uncertain times,” says Kim.

leasing to the transport and logistics sector

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