Rising fuel prices and a decline in spot freight rates could mean a future slowdown in used truck demand.
Used Class 8 retail volumes were 16 percent higher month over month. Longer term, volumes were down 17 percent year over year, according to the latest release of the State of the Industry: U.S. Classes 3-8 Used Trucks, published by ACT Research,
Average prices were 7 percent higher compared to January, and 83 percent more expensive than in February of 2021. Average miles and age were flat sequentially, with miles up 3 percent year over year and age 5 percent higher than last February.
“Used Class 8 same dealer retail sales volumes got an expected breath of life in February, jumping 16 percent sequentially,” says ACT Research Vice President Steve Tam.
“Typical seasonality called for a 13 percent increase, so elevated new truck activity seems to have provided a little traction in the secondary market; but in all likelihood, the bump is not sustainable,” Tam says. “New truck sales appear to have lagged the spike in December production and the accompanying echo in January. That could translate to another month or two of better-than-expected used truck sales.”
Regarding the future of the U.S. used truck market, Tam says, “Slowing freight growth, combined with the continued flow of new entrants into trucking, has effectively defined the start of falling freight rates. Through mid-March, rising fuel prices have masked a rapid month-over-month decline in spot freight rates. We contend that this signals an impending slowdown in demand for used trucks, with prices to follow accordingly, and some dealers already reporting prices softening around the edges.”
The report from ACT provides data on the average selling price, miles, and age based on a sample of industry data. In addition, the report provides the average selling price for top-selling Class 8 models for each of the major truck OEMs.