CITY OF
Item No. 9
AGENDA REPORT
DATE: May 12, 2025
TO: Honorable Mayor and City Council
\
FROM: Joe Pradetto, Director of Governmental Affair
SUBJECT: Authorize the Mayor to Send Letters in Support of a Congressional Inquiry into Potential Antitrust Issues Affecting Firefighting Equipment Manufacturing RECOMMENDATION:
That the City Council authorize the Mayor to send letters in support of a Congressional inquiry into potential antitrust issues affecting firefighting equipment manufacturing.
BACKGROUND/DISCUSSION:
Firefighting departments and agencies throughout the country have faced escalating prices and prolonged manufacturing lead times for fire engines and trucks. Declining equipment quality increases maintenance demands, while constrained parts availability hinders timely repairs, compromising readiness and public safety. Although the aftermath of the COVID-19 pandemic saw supply chain disruptions and rapid inflation, leaders in the firefighting industry have identified another potential source of these problems: antitrust violations.
The fire equipment manufacturing industry once featured numerous independent companies, fostering competition and stable pricing. In 2006, American Industrial Partners (AIP), a private equity firm, initiated a series of acquisitions, purchasing major fire equipment manufacturers, including E-ONE, KME, Ferrara, and Spartan. These acquisitions were consolidated into REV Group, establishing it as a dominant entity in the market.
A significant milestone occurred in 2016 with the acquisition of KME, which increased REV Group's market share from 4.6% to 22.6% in a single year. By 2023, REV Group controlled approximately 33% of the U.S. fire truck market, surpassing all competitors, while independent manufacturers accounted for only 20% of the market. Consolidation efforts included the closure of two manufacturing facilities, reducing production capacity. This concentration of market power afforded the REV Group significant influence over pricing and delivery schedules.
On April 14, 2025, Senators Elizabeth Warren and Jim Banks initiated a bipartisan congressional inquiry into private equity consolidation's impact on the fire equipment manufacturing industry, focusing on REV Group. A letter was sent to the International Association of Fire Fighters (IAFF),
requesting data on price increases, delivery delays, equipment quality, and parts availability by April 29, 2025.
Senators Josh Hawley and Andy Kim also issued inquiries to REV Group, Oshkosh Corp., and Rosenbauer America to investigate anti -competitive practices. The investigations seek to identify measures to restore affordability, reliability, timely delivery, and adequate parts supply.
REV Group's consolidation of the fire equipment manufacturing industry has led to significant challenges, including soaring prices, extended lead times, declining equipment quality, and parts shortages, all of which undermine readiness and public safety. While REV Group attributes these issues to external economic factors and claims mitigation efforts, congressional inquiries represent a critical step toward validating these claims and identifying solutions.
Action by the Yucaipa City Council, through letters to federal representatives, will support efforts to restore a competitive and reliable fire equipment manufacturing market, ensuring firefighters have the resources needed to protect our communities.
FISCAL IMPACT:
None.
Attachment(s):
1. Draft letters to Senators Padilla and Schiff, Representative Obemolte Approved by:'a" ` C� 3�
ATTACHMENT 1
May 12, 2025
The Honorable Senator Adam Schiff
112 Hart Senate Office Building
Washington, DC. 20510
Dear Senator Schiff,
CITY OF
2 On behalf of the City of Yucaipa, I am writing to express our concern about the limited competition in the fire engine manufacturing industry and the negative impact this is having on fire departments like ours.
Consolidation in the fire apparatus industry has led to higher prices, production delays, and limited options for fire departments nationwide. Over the past decade, fire engine costs have soared, wait times have stretched to over three years, and some manufacturers have imposed "floating" prices that increase costs mid -production. These conditions are creating a dangerous backlog of essential equipment, making it harder for cities to replace aging apparatus on schedule.
Fire departments across California must now keep older vehicles in frontline service far longer than recommended, leading to more frequent breakdowns, costly repairs, and increased risks to public safety. The inflated cost of new fire engines also strains city budgets, diverting resources from other critical public safety needs.
Recently, several Senators including Elizabeth Warren, Jim Banks, Josh Hawley, and Andy Kim have launched a bipartisan inquiry into anti -competitive practices in this sector, highlighting how the consolidation of several major manufacturers has led to sharp price increases, multi -year delivery delays, and parts shortages that jeopardize emergency response capabilities.
We respectfully request your support for ongoing Congressional efforts to investigate and address these industry practices. Ensuring fair competition and reliable access to firefighting equipment is critical to maintaining the safety and resilience of our community. Thank you for your attention to this important issue and for your continued advocacy on behalf of cities like Yucaipa.
Sincerely,
Jon Thorp
Mayor
City of Yucaipa
34272 Yucaipa Blvd, Yucaipa, CA 92399
909-797-2489
May 12, 2025
The Honorable Senator Alex Padilla
331 Hart Senate Office Building
Washington, DC. 20510
Dear Senator Padilla,
CITY OF
~t:
On behalf of the City of Yucaipa, I am writing to express our concern about the limited competition in the fire engine manufacturing industry and the negative impact this is having on fire departments like ours.
Consolidation in the fire apparatus industry has led to higher prices, production delays, and limited options for fire departments nationwide. Over the past decade, fire engine costs have soared, wait times have stretched to over three years, and some manufacturers have imposed "floating" prices that increase costs mid -production. These conditions are creating a dangerous backlog of essential equipment, making it harder for cities to replace aging apparatus on schedule.
Fire departments across California must now keep older vehicles in frontline service far longer than recommended, leading to more frequent breakdowns, costly repairs, and increased risks to public safety. The inflated cost of new fire engines also strains city budgets, diverting resources from other critical public safety needs.
Recently, several Senators including Elizabeth Warren, Jim Banks, Josh Hawley, and Andy Kim have launched a bipartisan inquiry into anti -competitive practices in this sector, highlighting how the consolidation of several major manufacturers has led to sharp price increases, multi -year delivery delays, and parts shortages that jeopardize emergency response capabilities.
We respectfully request your support for ongoing Congressional efforts to investigate and address these industry practices. Ensuring fair competition and reliable access to firefighting equipment is critical to maintaining the safety and resilience of our community. Thank you for your attention to this important issue and for your continued advocacy on behalf of cities like Yucaipa.
Sincerely,
Jon Thorp
Mayor
City of Yucaipa
34272 Yucaipa Blvd, Yucaipa, CA 92399
909-797-2489
CITY OF
May 12, 2025
The Honorable Jay Obernolte
2433 Rayburn House Office Building
Washington, D.C. 20515
Dear Representative Obernolte,
On behalf of the City of Yucaipa, I am writing to express our concern about the limited competition in the fire engine manufacturing industry and the negative impact this is having on fire departments like ours.
Consolidation in the fire apparatus industry has led to higher prices, production delays, and limited options for fire departments nationwide. Over the past decade, fire engine costs have soared, wait times have stretched to over three years, and some manufacturers have imposed "floating" prices that increase costs mid -production. These conditions are creating a dangerous backlog of essential equipment, making it harder for cities to replace aging apparatus on schedule.
Fire departments across California must now keep older vehicles in frontline service far longer than recommended, leading to more frequent breakdowns, costly repairs, and increased risks to public safety. The inflated cost of new fire engines also strains city budgets, diverting resources from other critical public safety needs.
Recently, several Senators including Elizabeth Warren, Jim Banks, Josh Hawley, and Andy Kim have launched a bipartisan inquiry into anti -competitive practices in this sector, highlighting how the consolidation of several major manufacturers has led to sharp price increases, multi -year delivery delays, and parts shortages that jeopardize emergency response capabilities.
We respectfully request your support for ongoing Congressional efforts to investigate and address these industry practices. Ensuring fair competition and reliable access to firefighting equipment is critical to maintaining the safety and resilience of our community. Thank you for your attention to this important issue and for your continued advocacy on behalf of cities like Yucaipa.
Sincerely,
Jon Thorp
Mayor
City of Yucaipa
34272 Yucaipa Blvd, Yucaipa, CA 92399
909-797-2489