Retail used prices continuing to set records; auction market leveling

Used trucks parked on lot

Though retail used truck prices continue to break records, pricing in the used truck auction space appears to be leveling a bit, J.D. Power announced last week in its April 2022 Commercial Truck Guidelines industry report.

Auction volumes rose to their highest point of the year last month, which J.D. Power anticipated, and with rising availability pricing continued its trend toward stability. The company says mileage appears to be the key differentiator in the current market — low-mileage unit pricing continues to soar but higher mileage equipment is starting to trend down..

Looking at 2- to 6-year-old trucks, J.D. Power says March’s average pricing for our benchmark was as follows: 

  • Model year (MY) 2021: No trucks sold in March
  • MY2020: $159,500; $3,804 (2.4 percent) higher than February 
  • MY 2019: $95,309; $8,705 (8.4 percent) lower than February 
  • MY 2018: $73,984; $11,361 (13.3 percent) lower than February 
  • MY 2017: $60,792; $8,225 (11.9 percent) lower than February 

In March, 3- to 5-year-old trucks averaged 0.1 percent less money than February, and 72.9 percent  more money than March 2021. Compared to last year, late-model trucks sold in Q1 2022 averaged 99.0 percent more money than the same period of 2021, J.D. Power says.

March 2022 auction used truck prices graphAverage auction selling price for 3- to 6-year-old sleeper tractors, adjusted for mileage.

Pricing wasn't as muted in the retail space. "Buyers continued to pay record-breaking prices for any desirable trucks that became available in March," J.D. Power says.

The company says the average sleeper tractor retailed in March was 68 months old, had 461,001 miles and brought $117,791. This average selling price figure has now set a new record every month for a full year. Compared with February 2022, J.D. Power says this average sleeper was identical in age, had 8,632 (1.9 percent) more miles, and brought $7,105 (6.4 percent) more money. Compared with March 2021, this average sleeper was identical in age, had 2,548 (0.6 percent) more miles, and brought $60,300 (104.9 percent) more money.

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In the popular 2- to 6-year-old cohort, J.D. Power states average pricing in March was as follows: 

  • MY 2021: $181,126; $6,043 (3.5 percent) higher than February
  • MY 2020: $162,283; $7,894 (5.1 percent) higher than February 
  • MY 2019: $138,891; $5,856 (4.4 percent) higher than February
  • MY 2018: $115,570; $4,953 (4.5 percent) higher than February
  • MY 2017: $82,324; $6,947 (9.2 percent) higher than February 

The company says 3 to 5-year-old trucks were up 4.7 percent from February, and the same cohort in the first quarter was 83.9 percent above the same period in 2021. The company adds even higher-mileage trucks brought consistent money in March, so any evolution in that segment of the market is so far limited to the auction channel. That said, any changes to market conditions usually show up at auctions first, and J.D. Power states it is noting an increased spread between auction and retail selling prices.

Dealers also retailed an average of 3.9 trucks per rooftop in March, 0.1 truck more than February as overall volume was similar to February.

March 2022 retail used truck prices graphAverage retail selling price for 3- to 5-year-old sleeper tractors, adjusted for mileage.

"For now, we’re sticking with our assessment that supply of new and used trucks is currently tight enough to insulate against any potential changes in the freight environment," J.D. Power states. 

In the medium-duty sector pricing pulled back.

For Class 3-4 cabovers, J.D. Power's benchmark group averaged $31,869 in March. This figure is $822 (2.5 percent) lower than February, and $11,795 (58.8 percent) higher than March 2021. Class 4 conventionals averaged $36,781 in March, $1,553 (4.1 percent) lower than February and $11,068 (43.0 percent) higher than March 2021. Class 6 conventional pricing averaged $48,733 in March, $2,948 (5.7 percent) lower than March and $23,024 (89.6 percent) higher than March 2021. 

In forecasting what's ahead for the used truck market, J.D. Power states ongoing changes in freight volumes and rates could soon make an impact on pricing.

"On the supply side, new- and used-truck availability is still tight. In the first two months of this year, [OEMs] delivered about 15,000 new trucks, which would be roughly 20 percent low in a typical freight economy and is severely inadequate in the current environment. In March, deliveries increased substantially to more than 20,000. It is not yet clear if this increase represents the first month of improved production or just a one-month anomaly like December 2021," J.D. Power states.

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Yet regardless of March's improvement, the trucks delivered in the first quarter are substantially less than the industry demands, J.D. Power says. Used sales per rooftop remain 20 to 25 percent below typical economic levels, solely due to an inadequate supply of trucks to sell. 

"On the demand side, consumer spending on goods has been the driving force behind superheated freight volumes," J.D. Power says. "March data shows spending still very strong if not increasing as notably. Business and manufacturing inventories have increased in recent months to meet this demand and insulate against future shortages. Inventories are now above the pre-pandemic trend. The need for supplies is less desperate."

J.D. Power also notes its initial 2022 prediction that economic conditions would support strong pricing in the first half of this year has not changed, yet continuing softness in the freight market, an increase in new truck production, and/or another major market change "would pull used truck pricing off historic highs."

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

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