The trend is unmistakable, folks. Used truck prices are taking a nosedive across nearly all years and models, as new truck manufacturers triumph over pesky supply chain disruptions. It’s like a stand-up comedy routine where the punchline is falling prices!
Anyone who shelled out big bucks for a used truck a few months ago might be kicking themselves now, experiencing a bad case of buyer’s remorse. I mean, it’s like buying a ticket for a comedy show, only to find out it’s an open mic night – ouch! Spot freight rates have taken a tumble, and contract rates are hot on their heels.
Buyer’s remorse? More like “Buyer’s Remorse: The Sequel” The days of chasing $4-a-mile loads are long gone, just like my dreams of headlining at Madison Square Garden. A whole bunch of drivers who reactivated their Department of Transportation authorities are now waving the white flag, either joining for-hire carriers or ditching trucking altogether.
Our good friend Chris Visser of J.D. Power Valuation Services predicts it’ll be a while before used equipment prices return to pre-pandemic levels. It’s kind of like waiting for your favorite comedian to make a comeback after bombing on stage – patience is key.
New Class 8 retail sales in the U.S. in October saw a 34.5% improvement compared to a year earlier, Wards Intelligence reported. That’s like selling out an entire comedy club after only expecting to fill a few seats!
However, preliminary used Class 8 retail volumes dropped by 10% compared to September, and they were 30% below October 2021, according to ACT Research. Retail prices rose by 1% month over month, but don’t get too excited – it’s a one-time deal, not a trend reversal. ACT Vice President Steve Tam chimed in, saying, “As the OEMs have continued to make incremental progress on overcoming supply-chain constraints, marginal improvements in output have logically followed.”
As the tight supply of new trucks eases up, used truck prices are feeling the downward pressure. It’s like the law of gravity – what goes up, must come down!
Class 8 sleeper pricing took a slight dip in October. The lack of low-mileage trucks is keeping those prices high, while other segments are reverting to the historic trend. It’s like the trucking industry’s version of a comedy roast – everyone’s getting a turn in the hot seat!
In October, 3-to-6-year-old trucks sold for an average of 2.8% less than in September and 20.8% less than a year earlier. It’s a depreciation fiesta, folks! Late-model trucks in the first 10 months of the year still sold for an average of 41.6% more than during the same period in 2021.
Looking ahead to 2023, Power expects used truck prices to keep on sliding, but for now, auction prices are holding steady, despite year-over-year comparisons going negative in October.
At retail, depreciation picked up speed for trucks with average mileage in October. The value difference between individual makes and models is widening, and the impact of powertrain specifications is becoming more pronounced.
Paccar Inc., the parent company of Peterbilt and Kenworth trucks, stated that its used models continue to outshine the industry in pricing. It’s like they’re the headlining act of the trucking world! Paccar CEO Preston Feight told analysts, “Regardless of the part of the cycle we operate in, we tend to get that premium. We continue to take advantage of the opportunities of selling more retail and that’s helped as a business in the long term.”
So, folks, it seems like the trucking industry is going through a bit of a rollercoaster, much like a comedian’s career. One day you’re riding high, and the next, you’re at the bottom of the barrel. But hey, the show must go on!
As we cruise into 2023, expect used truck prices to keep on declining, while new truck sales continue to climb. It’s like watching an epic battle of punchlines between the new kid on the block and the seasoned comic – you just can’t look away.
In the end, it’s all about supply and demand, folks – a classic tale as old as time. Or as old as that one joke your uncle tells at every family gathering that nobody finds funny anymore. But remember, in both trucking and comedy, timing is everything.
So, if you’re thinking about diving into the used truck market, you might want to hold onto your hats – and wallets – for just a bit longer. It could be a bumpy ride, but with a bit of patience and a keen eye on industry trends, you might just find yourself laughing all the way to the bank!