The wholesale channel continues to be a story of two separate markets, with trucks with under 600,000 miles representing the late-model, higher-priced component and the segment represented by trucks with over 800,000 miles increasing in popularity. Volume and pricing for this high-mileage cohort increased through the 1st quarter of 2014, creating differences compared to recent months.
On average, the typical used truck sold at auction or dealer-to-dealer in March was 86 months old, had 699,500 miles, and brought $32,183. Month-over-month, this truck was 3 months older, had 23,965 (or 3.3%) fewer miles, and cost $492 (or 1.5%) more. Year-over-year, the average truck was 7 months newer, had 43,785 (or 5.9%) fewer miles, and cost $8452 (or 26.3%) more. See graph below for detail.
The year-over-year increase is due mainly to a higher number of 2009 and 2010 model-year trucks moving through wholesale channels, their higher relative pricing comprising a larger proportion of the universal average this month.
Also, and more surprisingly, buyers continue to pay more for trucks with over 800,000 miles, continuing a trend that began in the 1st quarter. In 2014 to date, trucks in this mileage group make up a larger proportion of the market than they did in 2013. These trucks are most commonly from the 2006 and 2007 model years, which are popular as the last of the pre-DPF models. Engines will need a major overhaul if they haven’t had one already, but some buyers may consider this procedure worth the investment, since the market for pre-DPF trucks with remaining useful life remains healthy outside of coastal/port regions. See graph below for detail.
If auctions are an indicator of what dealers think their customers demand, pre-DPF trucks at moderate price points is an expanding market. We will continue to monitor this segment to determine whether these results are evidence of a long-term trend or merely a short-term anomaly following unusual weather-related results earlier this year. Stay tuned.