Used market setting records as prices continue to swell

Updated Jul 22, 2021
Truck on isolated highway

Price appreciation continued in the used truck market last month as the industry continues to reap the benefits from disjointed new truck production rates, J.D. Power reported Thursday in its July 2021 Commercial Truck Guidelines industry report.

Auction prices were up for nearly all segments despite increases in volume, with J.D. Power's benchmark group of 4- to 6-year-old trucks selling for 5.1 percent more than May. The company also reports late-model trucks have appreciated by 5.3 percent per month thus far in 2021, with pricing in its benchmark model up 85.1 percent from 2020 and 41.5 percent of 2019. 

    Pricing within the benchmark model was as follows:

    • Model year (MY) 2018: $71,263 average; $6,773 (10.5 percent) higher than May
    • MY 2017: $62,294 average; $7,268 (13.2 percent) higher than May
    • MY 2016: $40,794 average; $5,503 (11.9 percent) lower than May
    • MY 2015: $32,672 average; $4,291 (11.6 percent) lower than May
    • MY 2014: $26,536 average; $412 (1.6 percent) lower than May

    June Auction Used Truck Sales

    "June’s auction results were a study in contrasts, with lower-mileage trucks bringing stratospheric money and higher-mileage, rougher-condition trucks unimpressive," the company states. "A good number of trucks in that second category were present in the averages above, particularly for model-year 2016 and older. Overall volume was similar to last month, so we’re attributing the lower averages to an unfavorable mileage and condition mix."

    The retail market was even stronger, with multiple segment setting records.

    J.D. Power says the average sleeper tractor retailed in June was 70 months old, had 450,889 miles, and brought $66,759. Compared to May, this average sleeper was one month newer, had 3,650 (0.8 percent) fewer miles, and brought $3,151 (5.0 percent) more money. Compared to June 2020, this average sleeper was two months older, had 33,058 (6.9 percent) fewer miles, and brought an astonishing $30,983 (83.9 percent) more money, the company says.

    [RELATED: Used truck market 'completely nuts']

    Among the most popular retail segment of 2- to 6-year-old trucks, June's pricing averages were as follows: 

    • MY 2020: $120,655; $3,189 (2.6 percent) lower than May
    • MY 2019: $101,505; $1,903 (1.9 percent) higher than May
    • MY 2018: $77,341; $1,649 (3.1 percent) higher than May
    • MY 2017: $60,229; $798 (1.3 percent) higher than May
    • MY 2016: $50,475; $2,741 (5.7 percent) higher than May

    "The overall value of the used sleeper tractor market, as measured by the average selling price of every truck reported sold, is the highest since at least 2007, which is as far back as our records go," J.D. Power states. "The mix of trucks sold recently hasn’t changed appreciably in terms of age, with 70 months being the long-term average. Mileage is about 7 percent lower than the long-term average of 487,000, but other market factors are more impactful than this minor difference."

    The company adds that COVID-era market strength is mainly driven by trucks with average to low mileage, although the rising tide has lifted all ships.

    June Retail Used Truck Sales

    Month-over-month, late-model trucks brought 1.9 percent more money in June. In the first six months of 2021, late-model trucks were 20.9 percent ahead of the same period of 2020, and 2.6 percent ahead of the same period of 2019. On average, late-model trucks have appreciated 1.9 percent per month in 2021, the company states.

    Additionally, J.D. Power says retail traffic was basically unchanged in June with dealers averaging 5.3 trucks per rooftop, just 0.1 truck higher than May. The company says that's 1.3 trucks ahead of last year and 1.1 trucks ahead of 2019, though it would be higher if more trucks were available to sell. The company also expects retail appreciation to continue during the summer but, "later in the year, economic factors should start moving back towards trend and truck availability should expand somewhat, limiting price appreciation."

    The medium-duty space also recorded a very strong June.

    J.D. Power reports Class 3-4 cabovers average price in June was $22,154, $3,020 (15.8 percent) higher than May, and $8,569 (59.4 percent) higher than June 2020. Class 4 conventional trucks averaged $29,098, $346 (1.2 percent) lower than May, and $7,209 (33.0 percent) higher than June 2020. Class 6 conventional pricing averaged $31,537 in June, $859 (2.8 percent) higher than May, and $10,517 (50.0 percent) higher than June 2020.

    The three medium-duty segments have recorded price appreciation of 2.0 percent, 3.7 percent and 3.4 percent per month, respectively, in 2021.

    Throughout this year, J.D. Power has viewed Q3 as the earliest potential inflection point for the used truck market returning to normal levels but now that the calendar has reached July, the company says the industry's hot streak could continue a little longer.

    "We continue to look for an increased volume of fleet trades at auction, and as of this writing in mid-July, we’re not seeing it. Aged and well-used trucks are perhaps showing up in greater numbers, as are daycabs. This activity is what we would expect to see in the very early stages of a return to a normal trade cycle, but for now we’ll just keep an eye on it," the company reports.

    "As long as new truck availability remains constrained and freight rates keep truckers energized, used truck pricing is on solid footing."

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

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