A new Calgary e-business is the first in North America offering Internet-linked truckers portable online financing to buy their big rigs.

BigRigDirect.com Inc. will launch its Web site Monday, offering owner-operators direct capital equipment financing at competitive interest rates.

The private company is fuelled by “significant” seed money from Calgary-based bulk transportation heavyweight Trimac Corporation.

Internet-delivered financing will cost truckers less than traditional loans arranged by dealers or other third parties committed to their particular operation or brand of equipment, says Robert Klein, president and chief executive of BigRigDirect.

“What we’re saying is: ‘Go out and get your best deal on a truck and really have the ability to go in like a cash buyer,’ ” he says. “It should put truckers in a better position to negotiate a deal.”

Klein estimates that Net-delivered loans will save a trucker at least $1,500 to $2,000 on typical third-party charges for an $80,000 truck.

The market is as big as the road is long. Last year, about 415,000 owner-operators in Canada and the United States bought more than $7 billion Cdn worth of “18-wheelers.” More than 80 per cent of trucking equipment purchases are financed.

BigRigDirect expects to do about $260 million in financing business in its first year of operation, Klein says. “Given the size of the U.S. and Canadian markets, that’s not really a big bite . . . .”

Trimac, like most large fleets, has about 1,500 of its 3,000 trucks owned and operated by fiercely independent truckers who like to cut their own deals, he notes.

“We’re interested in it as a service to offer to our owner-operators,” said Ted Barnicoat, Trimac’s chief information officer. “We feel that owner-operators being able to get lower-cost loans for their rigs could be a valuable service,” and it will help attract more drivers “in a very tight market.”

Fifty-four per cent of long-distance truckers now travel with laptops, up from 16 per cent last spring, according to Newport Communications, a leading publisher of transportation materials. And 63 per cent of truckers have access to the Net.

“We were surprised a little bit when we did our research just how Internet-savvy they were,” Klein says.

A trucker is typically on the road 20 days of every month. The Net provides communications with dispatchers, access to online banking, news and stock quotes, even tips on the most fuel-efficient, quickest or best-weather hauling routes.

Most trucking lounges and truck stops in North America are now wired with Internet portals, Klein says. Many stops offer outdoor plug-ins for telephone and power connections direct from the trucks’ cabins.

Klein is a former banker who spent 15 years financing truckers — when he could locate them — mostly via long-distance telephone and courier.

He says most major banks don’t chase the business, even though an owner-operator could spend $130,000 to $150,000 on a complete new tractor-trailer.

BigRigDirect will broker loans through country-wide wholesale funders. A trucker will submit a streamlined application via the Web site, which is operational round the clock, and should receive an answer online in a matter of hours.

“We arrange the financing for them, much like a mortgage broker would do in the mortgage business,” Klein says.

Even in a bear market, the new company managed in its first round of financing to raise $892,500, from selling 1.785 million shares at 50 cents per share.

The private placement, handled by Jennings Capital Inc., included a provision to issue 737,000 additional shares to WARP! Internet Labs for developing BigRigDirect’s Web site. The proceeds also will go toward a nationwide marketing and advertising campaign, including posters at truck stops and billboards.

Truckers are a homogeneous group which makes them attractive to advertising, Klein says. Ninety-eight per cent are males 35 to 55 years old.

Once BigRigDirect’s Web site revs up in Canada, the company plans to expand into the much-larger U.S. market.

That includes opening an office south of the border and establishing more strategic alliances with large trucking firms.

Klein says he expects competition will emerge as the concept picks up speed. But it will be difficult for traditional financing delivery models to catch up, because they’d be cutting their dealers out of the profits, he adds.

For now, BigRigDirect has the road to itself.

Web Watch:
www.BigRigDirect.com