The midpoint of 2014 is a good place to catch up with the changes the sleeper market has seen in the past few months.
The year began where 2013 left off, with retail and wholesale activity at moderate levels due to the harsh winter. Then March exploded onto the scene with a massive increase in volume of sleeper tractors sold at auction, driven largely by 5- and 6-year-old trucks (2010 and 2009 model years). April was another big month for late-model sleepers, this time with 3- and 4-year-old trucks responsible for the increase. May’s results confirmed that a market shift was officially underway, with 3-6-year-old trucks selling at higher volumes for another month.
Wholesale pricing for 3-6-year-old sleepers has been only moderately impacted by the increased supply, with only 2011’s and 2012’s notably downward since the beginning of the year. In the retail channel, 2010’s and 2012’s have taken the biggest hit in price, while 2011’s have been largely unaffected through May.
With the 2012 model year representing a return to a normal build rate after the recession, plus a return to shorter trade cycles starting in approximately 2011, it is logical that the market would absorb an increased number of late-model trucks early this year. Pricing has trended flat to mildly downward, with depreciation kept in check by continued high demand for lower-mileage trucks. We expect results to follow this trend through the end of the year, with depreciation on 2011-2013 models averaging roughly 1.5% per month in both the wholesale and retail channels by December.
Look for the July edition of Guidelines later this week for more detail on this and other segments of the market.