TribLIVE

| Business


 
Larger text Larger text Smaller text Smaller text | Order Photo Reprints

As old delivery vans die, small businesses buy

Email Newsletters

Click here to sign up for one of our email newsletters.

On the Grid

From the shale fields to the cooling towers, Trib Total Media covers the energy industry in Western Pennsylvania and beyond. For the latest news and views on gas, coal, electricity and more, check out On the Grid today.

By The Associated Press
Friday, Feb. 28, 2014, 9:57 p.m.
 

DETROIT — To deliver bouquets in and around the nation's capital, Karin's Florist has two big vans, two small ones and a boxy little wagon that's clinging to life.

After the Valentine's Day rush, the Vienna, Va., business planned to get a van to replace the wagon, a Toyota Scion xB with 180,000 miles on it that has faithfully made its rounds since 2006.

“We've got it sewn together with rubber bands and paper clips,” said Maris Angolia, president of the family-owned business named for her sister.

The van purchase, the second for Karin's in the past four months, is evidence that small business owners are starting to invest in their companies again. The willingness to spend is good news for the auto industry and a positive sign for the broader economy.

The spending is coming for two reasons: Aging vans are simply wearing out. Business confidence is growing.

A January survey taken for Wells Fargo found that optimism among small-business owners hit the highest level in five years. Most expect increased cash flow and hiring this year. Once-tight credit for small businesses has loosened, and borrowing rose in the second half of last year, according to research by Experian and Moody's.

Commercial van sales last year were up more than 40 percent since 2010 and rose 9 percent in January, according to Ward's AutoInfoBank.

“A lot of these contractors have been trying to keep their old products as long as they can,” said Peter Bedrosian, senior manager of product planning for Nissan North America. “The vehicles are really nearing the end of their useful life.”

Van sales are a bellwether for the broader economic recovery because small businesses are reluctant to spend after a recession, said Mike Jackson, director of North American forecasting for the IHS Automotive consulting firm, which predicts commercial van sales will grow 27 percent between 2013 and 2015.

Auto companies have spotted the trend, and they're moving quickly to enter a market once dominated by Ford, General Motors and Mercedes. Nissan entered the market with the NV full-size van in 2011 and the NV200, as small van, last year. Chrysler's Ram brand started selling a full-size van last year and has plans for a small van. More products are coming from GM and Ford.

Subscribe today! Click here for our subscription offers.

 

 


Show commenting policy

Most-Read Business Headlines

  1. Experts: If health insurers’ safeguard goes broke, consumers could pay
  2. Pittsburgh union serving TV, film production looking for lots of help
  3. Visa limits vex businesses
  4. Nike, Under Armour invest in watching exercisers’ steps
  5. Methane leaks reportedly decrease in Pennsylvania
  6. Camera prevalence approaches sci-fi realm
  7. Paper’s prevalence unlikely to diminish
  8. Kings Family Restaurants sold to California firm
  9. Rules could kick door open for nuclear power
  10. Watch out for fraud, elder abuse
  11. Scented society is killing cheap perfume industry