Came back with a bank window down yelling out money anything hey oh Got the foot on the gas pedal to the metal when I'm getting to the back hey. Got the foot on the gas pedal to the metal when the lane moving fast hey. Let them all cross if they hate them let them made them make a bigger ball hey.
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And I say that before every single show. And what I mean by that is I only speak with transportation professionals because at the end of the day, you guys, I want to talk to the right individuals who have done what you're looking to do or who are currently doing what you're trying to achieve. So you can take that information, apply it, utilize it and see a meaningful difference in your business and your life. Happy Wednesday everybody. The weekly newsletter dropped this morning so I got to throw that out there you guys. Every single Wednesday weekly newsletter drops. If you want to sign up for it, just go to thefraycoach.com it will auto prompt you to sign up. I don't auto sign up everybody in my contact list because I personally hate when people do that to me.
So I will not do that to anybody else. But if you want to get it in on that, you guys, we talk rates, fuel prices, all industry related content though, so check it out. But with that being said, you guys, I got a very special guest for you guys here today. I, you know, he's my resident truck finance expert out there and you know, we're just going to be talking about all things current events inside of that. So I got my man, Mr. James Currier back on the show. James, thank you so much for joining me.
Coach, happy to be here. Thank you for having me as always.
No, dude, it's a pleasure. You know, there's lots to talk about here, man. It's seemingly everything that's going on right now was not on any of our radar here the last time were on the show. And you know, so here we are in a beautiful march. Everybody should be planning on how to go to the lake and everything as the world starts to thaw out. But Jesus, man, it's just one thing after another right now.
I'm not sure Jesus could have predicted this one.
Oh, man. So, dude, what's been going on in your world, man? Catch us up to speed.
A lot like the daily news. Very volatile and unpredictable. That's the best way I can put it right now. You know, no semblance of sense is essentially it. You know, we always do our best to try and mitigate risk and try and predict with as much accuracy as possible what's going on in the market, both in freight and finance. And man, if your glass ball works better than mine, then I'm all ears. But I can't make sense of anything that's going on right now. It very much seems like whatever the feeling or attitude of the day is what gets announced. There's a big pissing contest between several countries going on right now that is throwing all of the markets into turmoil.
Not, not just the freight markets, but yeah, you know, the all global economies have no idea how to react at any given point to whatever the announcement of the day or the hour is.
Yeah, no, dude, I'm right there with you. Right? It's seemingly, you know, like, I think it's very evident to anybody who's been paying attention for the last, I don' 18 months that the current administration is going to be all about America first policies, elevating American businesses and everything else. And you know, it is, dude. There's a lot coming at and I think like from My perspective, it's really tough to decipher what's true and what's not true because there's a lot of we're going to do this. But then within 24 hours it seemingly walks back. I mean, the Toronto, I mean it might be the Toronto premiere or the Ontario premiere. Doug Ford, what he did is like within 36 hours he made a complete 720 on everything it seemed, on what was going to happen and what was not going to happen.
And you know, I think ultimately I, I think it's like modern day the, all the citizens are the pawns in the great game of chess. On the realignment of a lot of agreements that have seemingly kind of been in place for a long time. And you know, I think it makes a lot of people kind of question, like, what the, is actually going on here? You know, like, I, I, for me, I just want like a, a little bit of all right, this is the direction that we're going to take. Right. Like, I wish there was a little bit more. I understand tariffs. Right. Like, I get it. I've done my own research out there. I'm not, I'm not going to sit here and trying to become a, a tariff expert or anything else just to capitalize on the flavor of the week.
From the content perspective, I understand the bargaining chip that it is ultimately seemingly being played out. But like, dude, there's a lot of businesses that are hanging on a whim here that are like, dude, what, can you just give us something so we can try and project and plan for the next six months?
Well, and the businesses that you're talking about are not just the small businesses of US, Mexico and Canada. These are the big three automakers of North America who are all clamoring to try and make sense of what's going on right now. And I'm sure having hourly meetings with several administrations, the reality of how these economies work and how things go across borders and the previous removal of tariffs based on the North America Free Trade Agreement and then the subsequent agreement that was signed in 2018 by the US and Canada and Mexico, you know, products were moving freely across borders with no tariffs because that was what was necessary for the economies of auto manufacturers to function.
What we've seen now is predominantly the big three, along with Kia, Honda, Toyota, they're all clamoring to make sense of how to potentially reshore to American manufacturing and rejig every supply chain that they've created over the last, you know, dozens of years. This is not Something that happens overnight. This is something that takes years if not decades to remanufacture. You don't just change your entire supply chain and manufacturing and production overnight. I get the buy American stuff. The reality is it can't happen that quickly. And when you're threatening tariffs and removing tariffs on either side of the border, all you're doing is throwing markets into disruption and causing panic and chaos. Right now there's no consistency on either side of the border and nor is there in Mexico or China or Taiwan or anywhere. The consistency is what the average consumer needs and wants.
With the markets flipping every single day and candidly tanking. You look at the S and P and the TSX and everything's going downhill right now because there's no consistency.
From, from your guys's perspective. You know, James, as a lender that's out there, how challenging is it for you guys to even, you know, like we're talking interest rates or terms or anything like that with everything that's kind of going on? Because it's like, you know, how apprehensive or not. Maybe this doesn't even affect you guys. But like, if you're seeing like, let's just use steel for example, right? Because that's the flavor of the week right now. That came out, you know, an additional, I think it's like up to 50% on steel. So say I'm a trucking company, for example, that does cross border freight and I only haul steel. How much is this maybe. And I was wanting to come to you this year and upgrade my fleet, for example.
How much of a candid conversation are we having right now, like as a pump the brakes or like, hey man, we don't want to do that unless you start diversifying your commodities. I'm just trying to bring it down to like the trucker level here.
Yeah, I mean, there are so many nuances with that conversation, Coach, that it's hard to have it in, you know, a 30 minute podcast. You know, what we're seeing right now is not just a conversation about the potential increase in prices of raw materials such as steel and aluminum. We're also seeing the increase of prices on softwood lumber, which goes into manufacturing on both sides of the border. The cost of everything going up not only drastically increases the cost of buying equipment for both the small, medium or all the small, medium and large fleets, but it also does a dramatic disservice to the amount of freight that will potentially be moved inter country and cross Border.
So what we're trying to figure out is how much of an impact the tariffs will potentially have on the cost of goods both in raw form and at the end of production. But also how will this have an impact on how much freight is actually being moved? Those two things are, you know, both tremendous factors in running trucking companies and entirely separate in your decision making process.
Do you guys have any indication on what this might do for the purchase price of new equipment at, you know, at this current juncture? I know there's a lot of shit that's kind of flying around right now and it might be hard to predict, but like, if we're out there, I mean, let's just talk Canada. For example. Are there any semi truck manufacturers solely based in Canada that manufacture 100 of everything in Canada?
No.
No. Okay, so is there any that, you know, even 50% of the production is done in Canada or is everything produced outside of Canada and then like trucks are imported up there from the States or China or what, you know, insert any other country there?
I, I don't think there are any. And, and I'm open to correction if there are any listeners willing to do that. I don't think there are any manufacturers that entirely rely upon the raw materials being produced in one country. Now there are manufacturers like Volvo who, I believe their entire supply chain is produced in the US now that doesn't mean that they don't take any raw materials potentially from other countries, but manufacturing, I think for Volvo happens entirely in the US for instance. So the reality is, you know, unless you're from steel roll to end product producing and manufacturing and assembling everything in one country, tariffs are going to have a dramatic impact on the price of new trucks and trailers.
The, your guess would be as good as mine as to how much of an impact that will have because when you're taking a raw material, say aluminum from Canada, bringing it across the border for, you know, potentially five or six times before, you know, an end product is produced and, you know, finally hits the end customer, who knows? I mean, I'm not sure there are agreements upon how much these tariffs will have an impact on the general consumer.
I think that's a really good point right there, James. And I've never actually thought about that until right now. And anybody out there who is, you know, please, the love of God, if you're going to sit here and say that you're a tariff person, make sure you're creating content on it 24 7. And you're not just doing it right now because it gets you some extra clicks. But you brought up that about the tariffs. And I would love to know this is the tariff paid one time. If it has to go back and forth across the, say it takes four times to get the whole thing done. Where, you know, it starts in Toronto, down to Cleveland, for example, back toronto, back to Cleveland. You know, it crosses a few times in the production cycle.
Is there a tariff paid every single time it crosses the border or is it a one time, you know, you can bring up across 37 times then. Hypothetical example.
No. So what they're anticipating is that every time steel or aluminum crosses a border, there will be a 25 to 50% tariff placed on that product. So from what I'm reading there, I believe it's 60% of the aluminum that is used in production comes from Canada. And then once that aluminum is sent from Canada, it then gets manufactured into something or jigged into something and then can potentially cross a border three, four, five times. And then a truck is produced or a trailer is produced and manufactured and assembled and then it crosses the border one or two more times. You know, again, there are entire teams of economists at private companies trying to figure out how much this is going to cost.
Yeah, no, absolutely. And I think that again, it's, you know, the, the gift and the curse of being in an environment like this is we have a lot of information coming our way. But the curse is it changes every five minutes. Now it seems right like to me the one thing. And again, I will always call out what I think is right or wrong. Okay. At the end of the day. And I think it's very wrong to flip flop as much as what's going on right now. That, that is one thing that I think that the current administration is doing a kind of a bad job on. And by kind of I mean a bad job on about like everything just flip flops, right? Like it'd be different if there was a clear, hey guys, this is what we're gonna do.
This is going to be in it for 30 days, 60 days, 90 days, whatever that looks like. There's an actual timeline, not, hey, I'm going to spew this information out and then the, you know, Canada is going to come out and say this and then we're going to come out and say that. Like nobody benefits from that. And that to me is a major miss. Now again, I understand that we're within 60 days of the administration actually starting. So there's always anytime that there's an administration change, at least here in the United States, there's always some that goes on right away. I just wish that with where we are from a technology perspective, I would just like more of a clearer, this is how long it's going to go on and everything else. Right.
Like, I just want more of a clear path and I feel like a lot of people do as well. And again, I'm only speaking for Chris Jolly, the individual here, but I just think it's very, it's putting a lot of burden on a lot of small businesses out there at the end of the day. Right. Like, especially if there are any small manufacturers here in the United States who might source their goods in, you know, say, Mexico or Canada, for example. And again, I get the whole America first movement that's out there. I have. If you've paid attention to my content for any length of time, I think it's very evident that I am very pro America in a lot of what I do.
But at the end of the day, there's a lot of people who have a lot riding on their current supply chain and how it is. And if they have to transition, there's got to be some sort of grace period to where they don't eventually lose their business because we want to pop shots and possibly up a lot of people's lives.
Again, it goes back to consistency and credibility. So, you know, what we're talking about here is just give us some sense of consistency. If it's going to go up 50%, make it 50%. And, and we'll deal with it eventually. And, and the, you know, yes, the cost will go up for the average consumer. And if it exceeds what the average consumer can sustainably manage, then the cost will come down. That's how economies work.
Correct.
It is no more simple than that. You know, that is the ultimate reality. So consistency is important and ultimately that leads to credibility. Let's remind ourselves that it was in fact your current president who wrote the, the trade pact in 2018 that he is now tearing up. So that goes back to credibility. Ultimately, and I agree with your Buy Americans are huge advocates for Buy American. So are Canadians. Canadians love America and Americans, I'm speaking for myself and millions of Canadians. We need America and America needs Canada just the same as America needs Mexico and Mexicans need Americans. Yeah, we are huge advocates for Buy American, just as we are huge advocates for by Canadian.
You know, we have such a tremendous buying power and trade union that it doesn't make sense to attack your largest trading partner in the fashion that is currently going on. And at the end of the day, like Doug Ford said last week, nobody wins in a trade war. The ultimate loser is always going to be the end user and purchaser. The average American and Canadian and Mexican.
Yeah. And that's the, you know, for me, it's like, it's the everyday person that I'm concerned about the most right at the end of the day. And, and again, I know it's still very early on in the administration. My whole thing is like, and it sounds like you're in agreement with here as well. James is, it's like, dude, I just need some consistency to play with here for a little bit. Right? Like, I think it, it's, it's irresponsible to flip flop back and forth on everything. Right? Like you said, if it's going to be 50%, let's stay at 50% for more than six hours.
You know, hey, listen, if you hate my guts, tell me you hate my guts, but at least stick to it.
Yeah, exactly. Right.
I can, I can manage that.
Yeah. But ironically, that's one of my biggest things that I like the most about our current president is at least he'll tell you to your face what he feels.
Yeah, yeah. Hey, listen, I, I, I'm trying to remain as objective as possible. You know, given the uncertainty in the turmoil and tumultuous markets. Like everyone else, we only want some semblance of stability and consistency. We just want to live our lives. And you cannot do it when the news changes not by a little, but by 90 or 180 degrees every four hours.
And I think it's very important to bring this point up and I understand the irony of this being a media show and everything else, but I think people maybe to possibly get off of social media for a little bit and trust and you know, verify the sources of where you're getting a lot of this information from at the end of the day, right? I, I think if you're on social media and you're like, no, I need to get my fix of social media information. Somebody who I would highly recommend Everybody follows is Dr. Jason Miller of Michigan State. At the end of the day, he speaks in facts, you might not like what he says, you might not agree with what he says, but at the end of the day, you guys, he's using actual data out There.
And it's not just his personal opinion because he likes or dislikes a certain individual or a certain government. Right. He speaks with data and that you should go after and seek a lot of that information. But you know, speaking about data, James, how about we, you know, we talk about some truck sales here for a little bit to kind of tie in a lot of this. And you know, I, I, we could beat this drum all day long, but at the end of the day, I think we're both pretty aligned. Like, dude, we just want some resemblance of, you know, consistency here for more than six hours. So. But yeah, I mean, I think it's really reflective in people's buying right now as well.
I mean, ttnews.com put out an article the other day yesterday that, you know, if you guys want to go to ttnews.com to check this up. February, class A truck orders drop 34% out there. And then preliminary data shows that it declined that year over year to, you know, 18,000 units. They also fell 29 sequentially when compared with January. And then they've been hit with unfavorable year over year comparisons for several months over the past years, with a few exceptions after a strong end to 2024. The past two months have largely been defined by trade and economic policy uncertainty that was out there. Carter Vaith from ACT Research had said that. And then ACT Research also found that seasonally adjusted orders fell 28% sequentially to 16,700 units. And this was the lowest seasonally adjusted reading in almost two years.
And it goes on to say, while we're what, while we are witnessing a market correction reflected in February's orders, Mack Trucks continues to see solid demand in the vocational segment, said Jonathan Randall of Mack Trucks. And then he also says, we remain optimistic about the industry's resilience as we navigate through current freight market challenges, focusing on delivering the exceptional value and performance of Mack Trucks out there. So, you know, when you're seeing a lot of that man as well, I mean, especially from your seat, you know, in finance and everything, is this time of year, is January and February historically a slower time for, from a fleet sales perspective, or is this kind of when you guys are really starting to ramp up?
It depends on the size of the fleet. You know, my biggest takeaway from that article is, you know, I sympathize dramatically with the carriers out there who were expecting 2025 to ramp up into better freight times. You know, we've had a really challenging 18 to 24 months of a freight market. And from everyone's perspective, were all hoping for better freight markets, increased freight rates, hopefully lower fuel costs. You know, one of the, you know, great things about Donald Trump when he was coming in was hell bent on reducing the cost of general goods like groceries, which dramatically increased freight. So, you know, hopefully these things all still happen in 2025. It's not looking great right now, but you know, the, at the end of the day, there are lots of businesses that focus on selling used equipment.
Those businesses will hopefully do very well this year. I would anticipate the cost of used equipment going up with, in line with the cost of new equipment.
No, definitely. And I, I think like that's, you know, from a market perspective, freight volumes. Here's what I can say as somebody who's on the front lines actively cold calling and prospecting shippers every single day. There has definitely been a sentiment change out there early this year. I feel like people are more optimistic that things are going to inevitably improve at some point. Right. Again, this is not a, everybody's leading to, you know, oh yeah, we'll sign you up right now. Everything else, I'm just talking about the sentiment of the receptiveness of my prospects in me selling my services. Right. So that tells me one of two things.
A, they're anticipating a increase at some point or B, their current market or their current network sucks and they're sick and tired of it and they're wanting to at least shake it up a little bit. Again, I'm not here to answer that other than I have called this out essentially since, you know, I don't know, the last 12 months. I don't think 2025 is going to have a major increase in anything. I think it's going to be a, another extension of a rebalance unless there's a black swan event or a major event that comes in and really shakes things up. And I think we're kind of on the cusp of something like that possibly potentially happening with everything going on with the tariff stuff. But I'll kind of leave it at.
And I think like at the end of the day though, you know, again, it's always going to boil down to controlling your controllables. Really. It really is.
Absolutely. Manage your costs as best you can, manage your customers as best you can outside of your controllables. You know, like in the finance game, I cannot control what the Fed does to their rate.
Yeah.
I can only manage how I control internally, what we're providing to the customer.
Yeah, no, absolutely. And I think LinkedIn user. I don't know who you are because it shows. LinkedIn user here says thanks for sharing an insights conversation. Reminds me of business reviews of Blockbuster Netflix. There's good and bad in everything. There's good and bad in the short and long term. Making this type of decision is rough. This one is one of the many reasons why I'm not in politics. And again and I think like to kind of.
Terrific point by the way.
Yeah, very good point. Like that's the thing is you know there's a very positive long term side effect that could come about this. Right. But we're arguing in today's terms for what could potentially roll out in five to 10 years. But James and I both knows that like the end of the day we're just asking for a little bit of stability right now.
We're, we're in the weeds in the thick of it and the reality is we, you know, nobody can see the light at the end of the tunnel. Tunnel because we don't know what the light is supposed to look like.
Yeah.
And listen, market corrections happen. Tremendous markets for freight happen. Down markets happen. These are all normal and part of the general cycle that we all face all the time. We just again, consistency and what in what to expect would be appreciated.
Yeah, no, I'm right there with you. And to their last point, this is one of the many reasons why I'm not in politics. Yeah. You, you don't want a guy like me too. I would be, I would bring what I mean I'm a very much a First Amendment absolutist. @ the end of the day, you guys don't want to hear what I have to say. It is one of the reasons why I don't do any industry flyings at D.C. Because I, I will not tolerate any of the way that the police, politicians are out there talking to the. Like I would lose my.
Well, that and the Ethics committee would have a heyday with you.
Your ethics. James, as always man, I appreciate you joining me. You're gonna be at the tca.
I'm gonna be a TCA in Phoenix next week.
Okay, so how does anybody reach out to you? Do you guys have a booth or anything? Are you guys gonna be walking around? How can people find.
I'll be there with Anthony Petit from our V Hub team. We'll be walking around reach on LinkedIn. James Currier or james.currier finlock.com anytime. Happy to answer any of your equipment finance related questions. Again, Chris, thanks for having me as always. It's a pleasure, dude.
I love it. You guys hit James up. If you guys cannot find James for whatever reason, hit me up. I'll gladly put you guys in direct contact with them, but that's going to be it for today. We got a guest coming on tomorrow and. And Friday as well. It's already Wednesday. And yeah, you guys, we're gonna keep coming back. 8:30aM Pacific, 10:30 Central. As always, if you guys got value in what you heard, subscribe to the show. You guys, if you're feeling really ambitious after this one, which you should be, rank the show on itunes and Spotify as well because that's how we get out there to your network. Because if you saw value, your network's going to see value as well. I appreciate you guys. I love you guys and we'll be talking to you soon.