Class 8 used truck pricing was generally stable last month while sales volumes fell after a busy September, J.D. Power announced Monday in its November 2020 Commercial Truck Guidelines industry report.
In the auction space, a small sample of high-mileage 2017 trucks caused J.D. Power’s overall benchmark model to trend down, though the company states the shift was “not necessarily representative of actual conditions.”
Prices were much more stable in other segments, J.D. Power says average auction prices were as follows:
- Model year 2017: $36,500 average; $15,042 (29.2 percent) lower than September
- MY 2016: $33,500 average; $1,272 (3.9 percent) higher than September
- MY 2015: $25,000 average; $775 (3.0 percent) lower than September
- MY 2014: $21,850 average; $1,850 (9.3 percent) higher than September
- MY 2013: $14,050 average; $2,671 (18.2 percent) lower than September
Overall, J.D. Power says its benchmark group of 4- to 6 year-old trucks brought 13.3 percent less money compared to September. The company says through the first ten months of the year, pricing is 9.9 percent lower than 2019 — though it has trended upward year over year during the second half of 2020.
“Thanks to this year’s recovery, our benchmark truck now shows an average monthly price gain of 2.8 percent per month in 2020,” the company says.
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Data was similar in the retail space, where the average Class 8 truck sold last month was 68 months old, had 451,925 miles, and brought $43,854. Compared to September, this average sleeper was one month newer, had 17,933 (3.8 percent) fewer miles, and brought $1,788 (4.3 percent) more money. Compared to October 2019, J.D. Power states this average sleeper was four months newer, had 12,747 (2.8 percent) more miles, and brought $6,727 (13.3 percent) less money.
In the industry’s largest cohort of 2- to 5-year-old trucks, average pricing in October was as follows:
- MY 2019: $93,179; $1,118 (1.2 percent) higher than September
- MY 2018: $71,246; $932 (2.7 percent) lower than September
- MY 2017: $51,254; $121 (0.2 percent) higher than September
- MY 2016: $37,409; $1,602 (4.1 percent) lower than September
J.D. Power says when compared to September, these trucks brought 1.5 percent less money. In the first 10 months of 2020, the company says retail pricing has averaged 15.1 percent lower than the same period of 2019. But depreciation in 2020 is now averaging 2.4 percent per month, a 0.4 percent improvement from last month, and in the historically-typical range.
“October’s retail averages were held back a bit by a larger volume of lower-spec trucks in the data, particularly for model-year 2016. Certain makes and models may start to see a more notable volume-related impact on pricing if this trend continues,” the company states.
Volume also was down last month, with dealers selling an average of 4.7 trucks per rooftop, nearly a full unit below last month’s average. J.D. Power notes “The fourth quarter is not typically strong for retail traffic, but we were hoping third quarter strength would continue. Still, 4.7 trucks per rooftop is better than any month since last August.”
Finally, in the medium-duty space, J.D. Power says October pricing fell slightly after a strong September.
The average price for Class 4 cabovers was $11,981, $394 (3.2 percent) lower than September, and $240 (2.0 percent) higher than October 2019. Looking at Class 4 conventionals, average pricing was $21,675, $1,123 (4.9 percent) lower than September, and $2,995 (16.0%) higher than October 2019. Class 6 conventional pricing averaged $20,737 in October, $2,365 (10.2 percent) lower than September, and $797 (3.7 percent) lower than October 2019.
Looking ahead, J.D. Power says COVID-19 and the Fed are the biggest threats to the used market maintaining its stability through the winter and into next spring.
“As long as the Federal Reserve keeps rates near zero and development of a COVID-19 vaccine continues to progress, Wall Street sees business as usual,” the company says. “Two items of concern are the spiking COVID caseload in many states (which will continue to get worse as winter sets in), and the cessation of the CARES Act, Paycheck Protection Plan, and other stimulus. The net result of these factors could be negative to the employment picture. Keep watching that metric.”
For more information, and to read the entirety of this month’s report, please CLICK HERE.