Stable pricing found in used market as trade volumes remain low

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Updated May 24, 2018

Avg selling price of 3 to 5 year old sleeper tractor trailersUsed Class 8 trade volumes remained below industry projections last month, keeping prices stable throughout the auction, wholesale and retail used truck markets, J.D. Power writes in its May Commercial Truck Guidelines market report.

Starting in the auction sleeper market, J.D. Power says the lower than anticipated trade rates found within the trucking industry allowed average Class 8 prices in April to outpace March totals and remain well ahead of 2017. The company also notes “smaller auction houses continue to move more trucks than last year.”

J.D. Power’s benchmark model for April shows model year (MY) 2015 tractors averaging $45,500, $4,750 (11.7 percent) higher than March; MY 2014 tractors averaging $34,000, $1,250 (3.5 percent) lower than March; MY 2013 tractors averaging $33,250, $1,750 (5.6 percent) higher than March; MY 2012 tractors averaging $26,500, $500 (1.9 percent) lower than March; MY 2011 tractors averaging $25,500, $4,750 (22.9 percent) higher than March.

The company adds four- to six-years-old trucks bought 20 percent more money in April than the previous period in 2017, adding “demand has clearly picked up, but we still predict an accelerated volume of trades in the upcoming months.”

Pricing wasn’t as dynamic in the sleeper retail market, but J.D. Power writes April still looks “to be another healthy month as supply remains in check.”

The company states the average Class sleeper tractor retailed in March was 76 months old, had 462,691 miles, and brought $48,534. Compared to the previous month, J.D. Power says that average sleeper was two months older, had 4,467 (1 percent) more miles and brought $53 (0.1 percent) less money. Compared to March 2017, this average sleeper was five months older, had 21,237 (4.8 percent) more miles and brought $623 (1.3) less money.

In the popular three- to five-year-old truck cohort, J.D. Power states average prices last month were as follows:

  • MY 2016: $84,565, $8,672 (11.4 percent) higher than February
  • MY 2015: $65,617, $2,198 (3.5 percent) higher than February
  • MY 2014: $46,555, $1,437 (3 percent) lower than February

On a year-over-year basis, J.D. Power writes late-model trucks sold in the first quarter of 2018 brought 4.8 percent more money than the same period in 2017. Additionally, the company states “there was no noticeable comparative movement” in March from a specific model basis.

One area where a major change was found was in the dealer sales per rooftop. J.D. Power writes “Class 8 sales per dealership moved up solidly in March, coming in at 5.7 trucks per rooftop. This result is the highest in 10 months and is in line with predictions. Winter weather is behind us, the freight environment remains red-hot, and buyers are relatively optimistic about the economy — so expect more dealership traffic.”

Retail value forecast change year over yearTurning its attention to the long-term market, J.D. Power adds “new truck orders remain extremely high, which will add supply to a market already expected to increase in 2018.”

Finally, used sales were mixed in the medium-duty market, J.D. Power reports.

Class 3 and 4 cabovers averaged $16,486 in March, which was $2,292 (16.1 percent) higher than February but $5,989 (26.6 percent) less than 2017. J.D. Power writes “March’s results splits the difference between January’s strength and February’s weakness.”

In the conventional space, J.D. Power states Class 4 trucks averaged $18,921 in March, $1,369 (6.7 percent) lower than February and $2,139 (10.2 percent) lower than March 2017. Class 6 trucks averaged $19,945, which was $112 (0.6 percent) lower than February and $1,377 (7.4 percent) higher than March 2017.

J.D. Power adds “Class 4 weakness this month was due to a relatively large number of lower-priced trucks impacting the average. We do not expect major depreciation in this segment through the summer.”

In predicting future months, J.D. Power writes: “We expect the supply of used trucks to continue to increase noticeably as the second quarter unfolds. Demand has improved quite a bit in recent months, which will keep depreciation at around the 2 percent level, on average, by year’s end.

For more information, and to read the entirety of this month’s report, please CLICK HERE.

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