After bottoming out in April, the used truck market began its recovery in May and appears strong enough to continue improving through at least the first half of 2021, said Mary Aufdemberg, remarketing president and general manager, Daimler Trucks North America (DTNA), during an industry roundtable discussion about the used truck market Wednesday.
“When [COVID-19] hit we weren’t sure what would happen, but now it appears to have spurred used truck demand,” Aufdemberg said. “Prices are on the rise, inventories are decreasing and even through supply also is increasing, we expect price to continue to rise into 2021.”
Compared to the pricing peaks of 2018, Aufdemberg acknowledged today’s going rates aren’t quite what the market was then. But she said after the sudden drop in demand the used truck market experienced last fall and the market trough that followed during the first months of the coronavirus pandemic, current pricing shows the resilience of the used truck market and its importance to the American economy.
Aufdemberg said that has created optimism throughout DTNA’s Remarketing and SelecTrucks divisions as well as its dealer network about the sales potential of the months ahead.
Another reason DTNA is optimistic is the strength of its flagship Freightliner Cascadia’s 2018 model year tractor, which will likely reach its inflection point where first owners will move the truck into the secondary market in 2021. Aufdemberg said over the past few years the used truck market has become increasingly interested in and accepting of vehicle safety systems, and said the 2018 Cascadia was a marked improvement in that area over prior tractors.
She said at DTNA, being able to provide top-quality safety systems has always been a company highlight, and its something the company is enthusiastically preparing to offer in a great volume in the used truck market next year.
“For any used truck customers who want to be market leaders, the Cascadia 2018 [model year] is something to keep their eye on,” Aufdemberg said.
She also noted efforts DTNA has made this year to shore up its go-to-market strategy due to the pandemic will prove useful into 2021 and beyond. SelecTrucks added four brick-and-mortar locations (Phoenix, Memphis and Chattanooga, Tenn., and Winnipeg, Manitoba) in 2020 and more are scheduled to be introduced in 2021. Additionally, Aufdemberg said the company has greatly enhanced its digital customer engagement and online business transaction capabilities to ensure customers can shop, inquire and purchase their next truck with limited in-person requirements.
Though titling and notary services are two in-person pain points that remain a challenge, Aufdemberg said DTNA has made improvements in other areas of the buying experience.
“We have always relied on digital leads, and we believe those digital interactions will continue to be more important,” she said.
As for other trends that entered the used truck market this year — such as an increase in cash buyers and the routing of more retail-worthy trucks to auction channels — Aufdemberg said DTNA expects the former to become less common as pricing rises but says the latter is likely to remain while supply and customer demand remain high.
“I think that’s okay. The used truck market has multiple channels,” Aufdemberg said of growing auction volumes. “You need different places for trucks to go … I think that then becomes the opportunity for the customer to decide what is the best fit for them.”
She said DTNA and SelecTrucks will continue to position itself as a trusted seller, offering a level of product assurance and financial services that customers can rely on.