From the monthly archives: July, 2012

We are pleased to present below all posts archived in 'July, 2012'. If you still can't find what you are looking for, try using the search box.

Unexpected Increase in June Average Pricing

With the majority of our June data received, NADA is projecting that sleeper tractors brought 5.4% more money than in May. Specifically, NADA estimates that the average sleeper tractor sold in June brought $50,750, and had 537,000 miles. These figures compare favorably to May’s results, which were $48,026 and 550,613, respectively. With new truck orders in a four-month slump, and used truck sales volume relatively low in May and June, an uptick in pricing is unexpected. June’s results are further evidence that demand for low- to average-mileage trucks remains high. The low supply of these trucks ensures price stability in the used market even as demand drops on the new side. NADA attributes June’s increase in average price to lower average mileage. In the current market, trucks with mileage under 550,000 can be expected to bring higher than average prices, and vice-versa. June’s average mileage was under that well under that inflection point, while May’s was right at it. As you can see in the graph ...

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Mixed New and Used Sales Volume not Affecting Pricing

New truck orders have decreased for the last four out of five months, and are now at a level not seen since immediately before the rebound in late 2010. New truck sales are still healthy, recovering from a dip early in 2012 to return to a level higher than all of last year save for December. Used truck sales per dealership took a steep dive in May, and preliminary June results indicate a very slight uptick that still leave the results in the “unusually low” category. So how have these results impacted used truck pricing? The answer, surprisingly, is not to any noticeable extent. The average retail price in May for a used sleeper tractor was $48,026, which was down less than 2% from April. As for June, we now project an uptick in average price, probably in the mid-single-digits. There is one big reason for the disconnect in new vs. used truck market trends: Supply. The strength in used truck pricing since late 2009 is largely due to the low returning supply of 2008-2011 model year trucks, which has resul ...

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Dealer Sales Volume Remains Low for a Second Month

With about 90% of our June sales reports received from the dealer channel, we are projecting that retail sales per dealership remained at 5.1, identical to May (note the revision to the May number due to multiple late reports). This result is 1.5 trucks lower than April, and 1.1 trucks lower than last June. May has been a slow month for the last three years, but there was a June rebound in 2010 and 2011. Not this year. We are still waiting for additional dealer and OEM reports, but initial sales data indicates that June sleeper pricing has not changed appreciably from May. We are projecting a price decrease of under 2%, or somewhere in the $500-$800 range, with average mileage very similar to May. We will withhold final analysis until we receive 100% of our data. As of now, we consider the decrease in volume mainly a supply issue – namely, a continued shortage of trucks with less than 550,000 miles - combined with a mild relaxation of demand due to reduced expectations for economic growth for the remain ...

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July 2012 Commercial Truck Guidelines is Available!

In the Commercial Truck July edition of Guidelines, Sleeper pricing remains at an historically-high plateau. Medium duty markets are not showing much strength or weakness and sales volume per dealership is notably lower than last month. To read more on July's Commercial Truck Guidelines update, download the report here.

Medium Duty Cabover Market Still Mixed

My last blog examined the medium duty conventional market. We were able to establish that 135,000 miles is roughly the point at which a truck in that segment hits price resistance. The cabover segment is more volatile (see graph). Since early 2011, average pricing has fluctuated from a high of $11,468 to a low of $8089. From that low to high point, mileage has only fluctuated by about 7300 – from 126,247 to 133,541. One factor at work here is the relatively low sales volume of these trucks. Most months are under 200 units, which doesn’t provide a lot of smoothing out of month-to-month variation in age or condition. Another factor is the occasional large influx of trade-ins from rental companies hitting the auction lanes at the same time. Those trucks could have an outsized impact on a monthly average. The volume graph below shows that volume has ticked upwards since January, and price has fallen since February. We are not yet ready to relate these two measures too closely. Until a price/mileage rela ...

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Medium Duty Conventionals Still Finding their Footing

The first graph below shows average price and mileage of Class 4-7 conventionals reported sold to NADA through the auction and dealer-to-dealer channels. The second graph shows number of trucks reported sold. Period is January, 2010 to May, 2012. The pool of available medium duty conventionals appears to be in the same situation as Class 8 trucks – namely, low-mileage trucks are increasingly difficult to find. The average mileage of trucks sold has trended upwards since early 2011, and that trend accelerated in early 2012. Since January of this year, there has been a near-perfect negative correlation between price and mileage. This means that the market has established a ceiling on what trucks of a given mileage are worth. We currently estimate that pricing meets resistance at roughly the 135,000 mile level. Trucks with mileage under that level should trend higher than average on price, and the opposite should be true for trucks with mileage over that level. As for number of trucks sold, there was a ...

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