Fast-growing trailer rental firm Hireco is investing in new tracking technology as well as new trailers as director James Smith tells Steve Hobson

With a fleet of 5,000 trailers, all under five years old, Berkshire-based Hireco ranked fifth in MT’s first CV Informer league table of trailer rental firms. Director James Smith has ambitions to increase the fleet to 8,000, which would leapfrog it to number three behind TIP and Ryder – not bad for a company founded just 15 years ago.

“Trailer rental is changing,” says Smith. “The focus used to be on the big boys but now it is the smaller players that are growing fastest.”

He says Hireco has been “the UK’s biggest buyer of artic trailers” so far in 2013 - 90% of which are built in UK.

“We have ordered 600 so far this year and still have a few orders to place,” he says. “No-one has as many new trailers as us. Our oldest were built in 2006/07 and they are all for sale. We have latest technology – brakes, suspension, LED lights etc. Why rent an older trailer that may be 40% less reliable when you can have a new one for the same money?”

Despite a handful of withdrawals or fleet reductions in the UK by major trailer rental companies since 2008, Smith says the overall rental fleet has “not decreased as much as people think”.

“The big companies financed their trailers over too long a period so they can’t sell them until they are too old to give the best service,” he argues.

Latest technology

Just as important as having the youngest trailer rental fleet however Smith says is the fact that Hireco is always looking to apply the latest technology to help operators reduce costs. Over the last three years Hireco has rolled out its innovative digi-pen that speeds up the process of on- and off-hiring trailers and improves maintenance procedures to all of its eight depots across the UK and Ireland.

More recently, it has specified BPW’s Idem trailer tracking and monitoring system on 150 new trailers.

“Idem is fantastic,” enthuses Smith. “It tracks the trailer and checks the bogey isn’t overloaded. It can also be linked to the electronics to monitor tyre pressures and remotely diagnose faults so breakdowns can be fixed much more quickly. Other options are sensors to detect when the doors are opened and monitor the condition of fridges, and it can also alert the operator if the driver is triggering the stability control or ABS too often.”

More than rental

Although Hireco does offer rental trailers at all its UK and Ireland sites – 20% of its fleet is available for spot hire – the company now offers many more services than just rental.

“Short term rental is still available, but 50% of our business is in contract hire and 30% is in long term rental,” says Smith. He defines contract hire as any deal over three years while long term rental is classed as a rental period of over one year. Hireco is now spilt into a rental division under John Egerton – recently recruited from Ryder - and a contract hire division which is looked after by Tim Gibson.

“We offer so many other services now – rental is just the base,” says Smith. “We offer contract maintenance  and full European breakdown cover. We have Hireco Financial Solutions to fund customer purchases, contract hire and leases. So we provide the full service - we can spec the trailer, build it at the best price, provide the finance and maintain it.”

The average contract hire term has begun increasing again since it fell to just two to three years in the depth of the recession and is now back to a more typical five to seven years. Hireco is also finding sale and leasebacks of existing fleets remains a popular option as operators look to run asset light.

“We have just done a deal with Suffolk-based national container haulier Goldstar to manage and supply 270 trailers on a sale and leaseback agreement,” says Smith. “Adding these 270 trailers to the 600 new trailers joining the fleet in 2013 helps us maintain its position as the largest young trailer rental provider in the UK.”

He argues that fewer transport companies now want the “aggro” of buying, owning and running their own fleet.

“With contract hire or rental they have no staff to employ and so can focus on their core business,” Smith says.

No aeros

One aspect of trailer hire that so far has not found favour are the various aerodynamic models now being offered by most trailer builders.

“We order trailers to suit all customers so if we fit air dams, sideskirts etc it can reduce our market,” says Smith. “All our doubledecks are low drag, with sloping roofs and wedge fronts, however, while speccing aerodynamic trailers can reduce fuel use they cost a lot to buy and can impact on RVs.”

New trailers are dear enough without going for the premium aero versions, says Smith.

“I said back in 2008 that new trailers would never be as cheap again and I was right,” he says. “They are now around 25% more than in 2007.”

Hireco now has 250 doubledeck trailers in its fleet and has 44 more on order. They feature wraparound curtains to maximise rear access and hydraulic or electric moveable decks for a flexible load space.

But the company has so far shied away from putting longer semi-trailers on the fleet, as they face an uncertain future. Longer semis are currently two years into a 10 year trial and have to be operated under vehicle special orders (VSOs).

“We don’t have any longer semis on the fleet,” says Smith. “We have been asked to quote a lot but we can’t buy them as we don’t have a VSO licence. Also, the market is not sure what will happen at the back end – if the trial ends and we have them out on contract hire what can we do with them at the end of the hire?”

Who should be responsible for trailer defects?

Surprisingly for someone whose company owns 5,000 trailers but does not operate a single one, Smith is in favour of trailer registration so the owner rather than the operator or driver of the truck hitched to it can be held responsible for serious mechanical defects.

“I can’t disagree – if we are renting a trailer it is our responsibility to make sure it is fit for use,” he says. “Is it fair that the responsibility falls on the driver? He is not an engineer and can’t get under the trailer to check for air leaks etc.”

At present, the operator of the truck towing a trailer is responsible for any defects from the moment the driver couples the tractor to it, and any prohibitions can drag down the operator’s OCRS.

“Whoever owns the trailer should be responsible – but then again it depends who does the maintenance,” says Smith.

Hireco services its trailers every six to 12 weeks when on hire and whenever they come off hire.

“Only one of our trailers has had a problem with Vosa in the last 18 months,” says Smith. “We can’t afford to have prohibitions – the customer will never use us again.”