From the monthly archives: January, 2013

We are pleased to present below all posts archived in 'January, 2013'. If you still can't find what you are looking for, try using the search box.

Despite Mixed Results, 2012 Outperformed 2011

As I mentioned in my last blog post, mixed performance in 2012, depreciating moderately in the first through third quarters, and then leveling out in the fourth. Older sleepers exhibited the inverse pattern, holding relatively steady until the end of the year, when they lost value.   Despite this mixed performance, sleeper tractors sold in 2012 outperformed those sold in 2011 when measured by age (see graph). All but the newest measurable age cohorts (two-year-old and three-year-old) brought more money than their year-earlier counterparts. For the most part, 2012’s higher average is attributable to stronger pricing in Q1-3. Prices paid in Q4 were comparable to slightly lower than the same period of 2011 on an age-adjusted basis. The similar performance of the newest model years speaks to the high value buyers continue to place on low-mileage equipment. The higher prices paid for older equipment is evidence of strong demand early in 2012 that moderated as the year progressed. Look ...

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Newer Sleepers Firm Up; Older Sleepers Continue to Lose Value

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 ...

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January 2013 Commercial Truck Guidelines are available!

The first Commercial Guidelines edition of 2013 is available for download! To see the full January 2013 edition of Guidelines, visit the Guidelines section of our web site today! 

Tax Agreement Implications for Trucking

By now you’re well aware of the basic components of the tax agreement recently codified into law. Of major importance to trucking are two facets that have gone largely unmentioned in the media. First, the Section 179 deduction has been retroactively restored to $500,000 for 2012, and extended for 2013 (2012’s limit was previously $125,000). This means business can deduct up to a half million dollars’ worth of new and used equipment from their 2012 and 2013 tax liabilities (although the benefit decreases if more than $2M is spent). Second, the 50% bonus depreciation has been renewed for 2013. This essentially means businesses can deduct half the cost of their new equipment in the first year (as opposed to spreading it out over time). This benefit is particularly attractive to businesses who spent or will spend more than $2M on equipment – not much of a stretch for a fleet replacing older trucks. Both these components of the tax law encourage investment. With the tax portion of the fiscal cliff addres ...

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Final November Retail Figures

The last few November sales reports provided additional insight into market behavior of 2010 model year sleepers. Specifically, additional data for that cohort proved our prediction of upward movement wrong. Our database now shows a more logical month-over-month decrease, with October’s increase an anomaly.

This additional data also pushed the overall sleeper average lower, to $48,711 – a $655 decrease vs. October. Average mileage decreased less than predicted, posting a 1.3% decrease rather than 5.3%.

These results illustrate the difficulty of predicting market behavior based on limited data. With a historically small number of 2009-2011 model year trucks built, we will continue to refrain from making definitive statements about monthly performance until 100% of data is received.

Stay tuned for a complete analysis in next week’s edition of GuideLines.

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