Stable pricing despite substantial volume fluctuations was the story of the used truck market last month, J.D. Power reported Tuesday in its Commercial Truck Guidelines Industry Report for November 2017.
In the Class 8 sleeper auction/wholesale market most prices in J.D. Power’s benchmark auction model were close to unchanged. The company pegged model year 2013 tractors at $28,120 average, $325 (1.2 percent) ahead of September; MY 2012 clocked in at $26,000 on average, $500 (1.9 percent) lower than September; and MY 2011 tractors finished at $24,000 on average, which was identical to September.
Additionally, J.D. Power states depreciation rates for these 2011 to 2013 model year tractors all remain below 1.0 percent per month, which “suggests the market is comfortable with current pricing.”
Looking at the larger wholesale marketplace, J.D. Power states the average sleeper tractor sold in September was 64 months old, had 501,747 miles and brought $33,602. Compared to the previous month, that average sleeper was six months younger, had nearly 20,000 fewer miles and brought 27.1 percent ($7,155) more money. In the popular 3- to 5-year-old sleeper cohort, J.D. Power states a large group of identical, relatively high-priced MY 2015 trucks hit the market in September and skewed the month’s average up 44.9 percent above August. Eliminating that group of tractors from the month’s totals brought the wholesale industry average back in line with August’s results.
The retail sleeper market also posted strong totals in September, with both volume and pricing on par with August. J.D. Power states the average sleeper tractor retailed in September was 75 months old, had 463,896 miles and brought $47,050. Compared to August, J.D. Power states that average sleeper was two months older, had 16,655 more miles and brought $768 less.
In the 3- to 5-year-old cohort, retail prices have slipped 1.3 percent per month in 2017 compared to 1.5 percent across the same period in 2016. Average pricing by age for the cohort was as follows:
- 3-year-old trucks: $70,555, $359 (0.5 percent) higher than August
- 4-year-old trucks: $51,596, $1,340 (2.5 percent) lower than August
- 5-year-old trucks: $42,586, $106 (0.2 percent) lower than August
Looking at the status of the market moving forward, J.D. Power states “supply of sleeper tractors will be an issue for the next two years, but the demand side should continue to incrementally improve.”
Additionally, J.D. Power reports sales per dealer rooftop rose significantly in September to 6.0 trucks, which is 1.3 percent higher than August and 1.2 percent higher than the same period in 2016.
Finally, the medium-duty marketplace also saw volume fluctuations in J.D. Power’s recent sales data, with the Class 3-4 cabover market trending down. J.D. Power states its benchmarket group’s average September pricing was $13,110, which was $1,488 (10.2 percent) lower than August and $2,796 (17.6 percent) lower than September 2016. The company adds there was no clear reason for the monthly decline and that it does not consider it to be significant.
The medium-duty conventional market was more in tune with its August levels, where volumes were similar month-over-month for Class 4 tractors and elevated for the Class 6 market. Regarding depreciation, J.D. Power states Class 4 trucks lost 1.5 percent of their value during the first nine months of 2017, with year-over-year pricing being flat. In Class 6, monthly depreciation sits at 1.9 percent (similar to 2016) but that pricing is down 10.8 percent compared to 2016.
Overall, J.D. Power states “buyers and sellers seem comfortable with current pricing levels. The supply of used sleeper tractors will increase in upcoming quarters, but pricing dropped enough from mid-2017 through early 2017 that the worst of the depreciation should be behind us.”
To read this month’s report in its entirety, please CLICK HERE.
