With about 85% of December sales data received, NADA’s year-end analysis should show that newer model years depreciated moderately through October, and then firmed up starting in November. Interestingly, older sleepers exhibited an inverse pattern, depreciating mildly or remaining flat through October, and then increasing their rate of devaluation in November.

The devaluation of older equipment is most likely driven by a combination of higher supply and more widely varied selling prices by model, which is resulting in unusually low numbers in some cases. By contrast, newer equipment may have depreciated to the point where it is now more attainable to the typical used truck buyer, firming up demand.

December’s selling environment was defined by continued uncertainty over fiscal cliff negotiations and a shortened selling period due to the holidays. The tax portion of the fiscal cliff has been addressed, but ongoing brinksmanship over the debt ceiling and spending side of the equation should keep a lid on increased growth in the short term. As such, expect similar trends – perhaps with a somewhat reduced rate of depreciation for older tractors – through the first quarter.

As always, your comments and questions are welcome below.