Supply, Unchained: An Update on Vehicles, Upfits & Intergalactic Backorders

Remember 2021? We learned more than we ever thought we would about semiconductor chips. Dealers were receiving incomplete vehicles. About 7 million units of auto production were lost. Fleet orders well exceeded plant capacities, and manufacturers implemented an allocation system. 

After three disruptive years, finally, vehicle supply is largely no longer an issue. 

“Throughout 2024 the overall supply of new vehicles has improved significantly, and dealer inventory levels continue to increase,” Holman’s Director of Supply Chain Solutions, Patrick Doyle, said.

Doyle said nearly all manufacturers have returned to open ordering across most segments — including high-volume light-duty truck models — with allocation-based ordering only affecting a limited number of commercial vans and full-size SUVs. 

Doyle added that incentives and customer-specific CAP agreements have increased. As a result, most fleet operators are pivoting back to traditionally popular fleet models after several years of exploring alternatives. 

According to Work Truck Solutions’ quarterly analysis, new work truck inventory increased almost 40% in the third quarter of 2024 over the previous year. 

“If you want to order a (gas-powered) Silverado 1500 to your exact specs, I’m telling customers I can have it in two to three months,” said Brian Rigby, commercial sales manager for Woodbridge, N.J.-based Richard Lucas Chevrolet. “A year ago, I’d tell them six to eight months, if I could get it.”

Rigby said free-flow ordering has opened on 75% of 2025-model year GM vehicles. 

The supply of Silverado HD pickups has also loosened. “I’m telling customers four to six months,” he said. “It’s gotten better, but it’s not where light duty is.”

Work Stoppages & Mother Nature

While vehicle supply has ameliorated, finished trucks and vans can still be held up on their way to the buyer.  

“We’ve seen availability open up tenfold over the past six to eight months,” said Sidney Miller of Midway Ford in Kansas City. “But once they’re produced, all it takes is one component or one hiccup to stop you from being able to deliver the truck.”

Issues range from a recall, a missing part on “intergalactic backorder,” as Miller puts it, a quality hold at the plant, or Mother Nature.

“Here in Kansas City, we had a hailstorm back in March that just put us all at a standstill,” she said. 

Every vehicle in the supply chain needed to be inspected, whether at a factory, upfitter, or dealer. PDR (paintless dent removal) technicians had to be dispatched across the Kansas City metro. 

“There are so many different things that can impact the delivery of a truck,” Miller said.

Including hurricanes. Helene, which did more damage than Milton, forced GM to temporarily shut down production at two factories. Road closures in North Carolina are expected to cause detours well into next year.

Helene left as many as 138,000 vehicles flood-damaged across six states, according to Carfax estimates. 

On the human side, the longshoreman’s strike at the East and Gulf Coast ports ended after three days, averting any supply chain snags. 

“This triple whammy — the two hurricanes and the port strike, even though it was short — we’re talking about a lot of displaced workers from damaged housing,” said Charles Bowles, director of strategic initiatives at Commercial Truck Trader.

“That’s going to create some labor shortages, and we’ve seen that with other natural disasters.”

Servicing & Parts

“Servicing is still a hassle,” Rigby said. His dealership added six more service bays and has plans to expand again, but finding medium-duty technicians remains a challenge. Rigby estimates that local labor rates for technicians have gone up about $50 per hour in the last year and a half. 

The increasing penetration and sophistication of vehicles’ ADAS (advanced driver assistance systems) is compounding the labor shortage.

Previously, technicians were able to perform some repairs and diagnostics with a site visit. Now, those jobs require programming at the dealership, which ties up repair bays and elongates service times, Rigby said. 

Rigby added that parts supply has improved somewhat, a benefit to service times. 

Mike Butsch, president of Primrose Equipment and Fabrication, has seen parts supply improve as well. Yet he estimates that service departments at many medium-duty and Class 8 truck dealers are still 20% understaffed. 

On a positive note, greater vehicle availability is influencing repair-versus-replace decisions. For the last several years, “fleet operators were often forced to repair vehicles rather than replace them, even as maintenance costs continued to climb,” Doyle said.

“Today, with maintenance expenses still on the rise, fleet operators now have the option to replace vehicles rather than repair them when appropriate.”

Bodies, Upfits & Equipment

Overall, the supply chain supporting the upfitting sector has improved significantly over the last 12 to 24 months, according to Ted Davis, senior VP and COO of fleet management upfitting for Holman, which also manufactures truck and van components.

“Generally speaking, fast-moving parts like racks, shelving, and storage are in good supply today with most available in less than six weeks from order to delivery,” Davis said. 

“Supply constraints in other pockets of the industry continue to rebound as well. The availability of standard bodies is steadily improving with most lead times back to pre-pandemic norms of six-to-ten weeks.”

Davis said crane availability, which saw lead times of over 12 months during the pandemic, has improved to six to nine months. 

However, some specialized components are still experiencing extended lead times. Davis said custom bodies still have lead times of 20 to 40 weeks, depending on the build specs, and truck caps continue to have extended lead times of 16 to 24 weeks.

“If a body is custom, it can take up to a year,” said Ted Chan, fleet manager for Schindler Elevator. 

Chan is seeing longer lead times of eight to 10 months for standard bodies. To mitigate delays, Chan is considering committing to bodies before he even has VINs of the builds.  

Butsch is also seeing delays in finishing vehicles, though it varies by weight class and equipment type. 

He said conventional upfits for ½-ton to 1-ton trucks and vans can be delivered in three to four weeks. 

Vocational mechanics packages on cab chassis and cutaways could still take six to nine months, while bodies and upfits for Class 5 trucks and above could still be delayed by 18 months to three years. 

Midway’s Miller is seeing issues at upfitters due to a lack of labor, which caused one upfitting job to be pushed out from 45 days to six months.

With vehicles readily available and some upfits causing extended delays, timing the truck or chassis sale with its final completion is a conundrum. 

“Once interest rates climbed to 8%, dealers required payment after trucks had been sitting at upfitters for 90 days,” said Charlie Stevenson, fleet manager for Essential Utilities. “So now we have to pay for the chassis while we wait for the upfit to be completed.”

Vehicle Transport

Transport of vehicles through the supply chain is another challenge. “Unfortunately, these transportation delays continue to linger and show little sign of improvement for the foreseeable future,” Holman’s Doyle said. 

Matt Salm, COO of Auto Driveaway, said transport timelines at his company have declined. But he points out that external factors are affecting the transport situation.

Extended upfitting timelines have caused fleets to pressure transport vendors for expedited deliveries and turnaround times on delayed vehicles or those that have been sitting for prolonged periods.

Technician shortages and extended warranty repair timelines also continue to impact transport times. “It just takes longer to get basic services done in many places as providers are understaffed,” he said. 

Demand, Short & Long Term

Over the last 18 months, the market has satisfied pent-up demand brought about by unprecedented vehicle scarcity after the pandemic. But today, many fleets now have what they need.

“I have allocations in which I have yet to pull the trigger because I don’t need them,” said Chan. “I have a lot of suppliers telling me they have an inventory of vans and trucks that I have declined.”

Other factors, such as high interest rates and still high vehicle prices, have tamped down demand, Rigby said. Meanwhile, fleets are realizing ways to hold trucks longer by using telematics data for more precise servicing. 

According to Work Truck Solutions’ data, dealers’ days-to-turn for new work trucks increased a monumental 69.4% in the third quarter of 2024 compared to 2023. 

Fleets are also postponing purchases because of delays in upfitting, though the Fed’s recent interest rate cut should help fuel purchases of light units, Butsch said. 

The 2024 presidential election is another wildcard, as fleet buyers wait to see if stringent new diesel regulations and zero-emissions mandates will be modified or abandoned altogether by a new president. 

Pending regulations could be the biggest factor impacting demand in the coming years. In 2027, new NOx and pollution standards set by the U.S. EPA will converge with greenhouse gas and zero-emission vehicle regulations enacted by California and followed by 12 states. 

Butsch estimates the new regulations could add about 28% to the cost of a medium-duty chassis. 

The EPA27 “pre-buy” of the older emissions technology will pull chassis sales ahead in late 2025 and through 2026, with a stark drop-off in sales in 2027 and 2028. 

A Bright Outlook

Of supply in general, “It’s definitely going back towards that normalcy,” Rigby said. “But I don’t think it’ll ever go back to the way it was before COVID, where dealers had three to four hundred cars on the lot and plenty to choose from.”

“I still think we’re going to see upfitting challenges for a long time in medium and heavy vocational, and the more complex it gets, the harder it’s going to be to get stuff done,” Butsch said. 

Doyle recommends that fleets be even more proactive about factory ordering. Close collaboration with supply chain partners would help mitigate the impact of these delays, particularly for units that require extensive fitting. 

Says Bowles: “What may be working in favor of the commercial truck industry right now is that we got away from that single point of failure within the supply chain. I think we all learned a lesson during the pandemic that you need several alternatives.”