Used truck market springing back, dealer association reports

Spring has brought with it a thaw in the used truck market: Preliminary March data shows retail volume moving back to typical levels after a very depressed January and February, according to ATD/NADA’s April Commercial Truck Guidelines.

“The recovery is in line with our previous predictions,” said Chris Visser, senior analyst and product manager, in a recent blog post. “Volume should be healthy going forward, thanks to the ample supply and continued strong demand for late-model iron.”

More specifically, three- and four-year-old sleepers are bringing prices similar to this time last year, while five-year-old trucks are bringing substantially more, the report says.

  • 2013’s averaged $90,694 through February―a $569 (or 0.6%) increase over 2012s this time last year.
  • 2012’s averaged $74,562―a $2,472 (or 3.2%) decrease vs. 2011s this time last year.
  • 2011’s averaged $67,706―a $5,750 (or 9.3%) increase over 2010s this time last year.

Model years 2010-2012 represent the majority of sleepers sold in the retail channel, making up  nearly 60% of the ATD retail sleeper database—up from 40% a year ago. These trucks are mainly trades resulting from the acceleration in new truck deliveries that started in the second quarter of 2014, the report notes.

Chris Visser

Price-wise, despite the increased supply of 2010s, those trucks are now depreciating less than newer trucks, having taken the biggest hit through early 2013—when they became affordable for a wider range of buyers.

“We expect the same process to play out for 2011s and 2012s this year,” Visser said.

The report also notes that 2011 was the first full model year for EPA2010 emissions standards and selective catalytic reduction (SCR), meaning the trucks are capable of higher fuel economy than pre-SCR trucks and their reliability may also be improved.

In addition, most of these trucks are still in the “desirable” under-500,000-mile category.

Depreciation in the wholesale channel has been more pronounced, however. Sleepers that are three years old are performing better than last year, but four- and five-year-old units are not, Guidelines reports.

  • 2013s averaged $72,861 through February 2015―a $3,445 (or 5.0%) increase over 2012s this time last year.
  • 2012s averaged $56,193―a $5,951 (or 9.6%) decrease vs. 2011s this time last year.
  • 2011s averaged $37,983 through February 2015―an $11,014 (or 22.5%) decrease vs. 2010s this time last year.

The growth of model year 2010-2012 in the wholesale supply mirrors that in retail.

Visser also points out that the low sales volume over the winter “has made analysis difficult.”

Additionally, “an extremely high volume of three- to five-year-old International ProStars cycled through wholesale channels in the third and fourth quarters, contributing to increased depreciation for the market on average.”

Looking ahead, 2010-2012 models will remain the dominant models in the used-truck marketplace through the first half of this year, until 2013s come on to play a larger role, Visser anticipates. Prices will follow the supply-and-demand curve, while the proportionally higher price of new trucks will continue to insulate against more severe depreciation.

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