From the monthly archives: June, 2013

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

Higher Pricing and Lower Volume in the Wholesale Market

Over the past two months, fewer high-mileage sleeper tractors have cycled through the wholesale channel. Average mileage is down notably from its peak in March of this year, while pricing is up more than 15% from recent lows. May’s total wholesale volume decreased notably, although this decrease is not entirely attributable to Class 8 trucks. Specifically, May’s average pricing of $28,468 was $4737 (or 16.6%) higher than March’s, while mileage decreased by 59,510 (or 8.0%) to 683,775. Trucks sold in May were a notable 10 months newer than those sold two months earlier.   This trend began in April, so month-over-month comparisons are not as impressive. May’s pricing was $963 (or 3.3%) lower than April’s, while mileage was 1673 (or 0.2%) lower. Age was 3 months newer.    Year-over-year, May’s pricing decreased by $4129 (or 12.7%), while mileage increased by 50,448 (or 7.4%). Trucks sold in May of this year were 4 months newer than those sold a year ago.   The wholesale market contin ...

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Another Month, Another Record for Sleeper Tractor Pricing

For the third month in a row, the overall value of the retail sleeper tractor market set a 5+ year high. May’s result just eked out April’s, coming in at $51,646 – a $255 (or 0.5%) increase month-over-month, and a $3525 (or 6.8%) increase year-over-year. That tractor had 533,293 miles – a 4110 (or 0.8%) increase month-over-month, and a 19,750 (or 3.7%) decrease year-over-year. In terms of age, May’s average was 75 months – 3 months newer than April, and identical to May, 2012. As has been the case since late last year, the number of 2009-2011 model year tractors available to the secondary market continues to grow. These newer model years are now coming off lease, and generally feature mileage in the 500’s or lower. This mileage range makes the trucks very attractive to the used truck buyer.   Interestingly, the 2007 model year, which was built in the highest numbers since the late 1990’s, was finally overtaken in the secondary market by the 2009 model year. 2007’s are averaging in the low 600,00 ...

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New Data Supports Strong Used Truck Pricing

Two new pieces of data were released in the past few days that support our long and strong view of used Class 8 retail pricing. First, the American Trucking Association released their Truck Tonnage Index figure for May, showing the highest level on record. Second, R.L. Polk released data showing a 3.0% increase in used Class 8 registrations in Q1 2013 vs. Q1 2012. Total registrations were not record-setting, but were among the highest in the past five years.   NADA data shows a 2.5% increase in the average retail price of a used Class 8 sleeper in Q1 2013 vs. Q1 2012. 2009 and 2010 model year trucks are entering the market in greater numbers, fulfilling some of the demand for lower-mileage iron and bolstering the overall average. Sales per dealership rooftop were down 1.6% in Q1, although volume came back a bit in April and May, and 2013 is now leading same-period 2012 by a similar margin.   The low returning supply of average- to low-mileage 2008-2011 model year trucks will support high retail ...

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Medium Duty Recovery Still Mixed

The graph below traces average wholesale selling price of Class 4 and 6 Conventionals from January, 2008 to May, 2013.   Both segments recovered mildly in early 2010 along with the rest of the commercial vehicle market. Class 6's came on-line more notably in 2011. Mileage and age mix during that period was similar to earlier periods, so the increase in pricing at that time appears to be a natural increase in demand. Both segments saw a notable bump in early 2012. In the case of Class 4, a large number of newer trucks cycled through the auctions during that period - most likely a fleet trade package. Pricing returned to previous levels after those lower-mileage trucks were "cleaned out" of the market. In the case of Class 6, that segment was likely enjoying a favorable supply/demand relationship until a large number of trucks was introduced to the market - possibly a large package of trade-ins from a rental company. This sudden influx of trucks of average age and mileage brought pricing down substantial ...

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June 2013 Commercial Truck Guidelines are Available for Download!

The overall value of the retail sleeper tractor market set a new record high for a second month in a row. An increasing number of newer model year tractors en-tering the market combined with continued strong demand for sub-600,000 mile trucks are the main fac-tors behind recent gains. Download the latest edition of Commercial Truck Guidelines today! 

Retail Sleeper Market Continues to Trend Younger

As the graph below indicates, the 2009 and 2010 model years are really coming on line, comprising a much higher proportion of trucks sold since late 2012. 

One main reason for this trend is of course the normal 4-5 year trade-in cycle common in the industry. There is also another factor with interesting implications for market dynamics. We’ve reported that trucks with over 600,000 miles are increasingly being pushed to the wholesale channel, while trucks with lower mileage are enjoying historically high retail value. 

2007’s are now averaging at or slightly above that critical 600,000 mile level. Meanwhile, newer model years with lower mileage are snapped up as soon as they become available. This is why we continue to predict that the low production rates of newer model year sleeper tractors will support strong pricing going forward.
 

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