The trucking trade’s technical recession is inflicting real-world impacts to the used truck market, the place gross sales proceed to fall and even sought-after low-mileage rigs are underneath stress.
Preliminary used Class eight identical seller gross sales fell eight % in June in contrast with Might, in keeping with ACT Analysis. Used truck gross sales had been down 25 % in contrast with the identical month in 2018. For the primary half of 2019, used truck gross sales are down 18 %.
June was the third consecutive month-over-month decline and mirrors anemic orders of latest vans, which have declined for eight consecutive months on a year-over-year foundation. Fleets ordered so many new vans in 2018 that the backlog awaiting manufacturing continues to be north of 200,000 items, ACT estimates.
“Regardless of six months of declining freight, most carriers are simply now coming to grips with the fact of their markets,” stated Steve Tam, ACT Analysis vice chairman.
ACT stated on July 11 that every one the trucking economic system metrics it tracks have declined for not less than two consecutive quarters, which is the technical definition of a sector recession.
In line with J.D. Energy Valuation Companies, used truck costs in Might drifted decrease month over month for 5 consecutive mannequin years from 2012 to 2016.
Mannequin yr 2016: $36,500 common; $7,420 (-17.zero %)
Mannequin yr 2015: $36,000 common; $eight,380 (-18.9 %)
Mannequin yr 2014: $28,750 common; $three,428 (-10.7 %)
Mannequin yr 2013: $23,500 common; $1,300 (-5.2 %)
Mannequin yr 2012: $18,750 common; $2,964 (-13.7 %)
“Late-model, low-mileage sleepers are now not in brief provide, and vans with common and better mileage are oversupplied,” Chris Visser, J.D. Energy business automobiles senior analyst and product supervisor, informed FreightWaves.
“After greater than two years of accelerated financial growth and record-breaking new truck orders, the nationwide fleet of vans lastly reached after which exceeded the quantity wanted to maneuver the present quantity of freight,” he stated.
That’s main fleets to renew one-for-one alternative of vans coming off four- or five-year leases.
By way of April, fleets and different trucking corporations stored these vans in service. That led to fewer vans accessible at auctions, which propped up costs. Some corporations bypassed auctions to promote their used fashions on-line, Visser stated.
With costs falling, fleets are returning to conventional auctions.
“The full nationwide fleet of vans might be about as huge because it must be to deal with present demand for freight,” Visser stated.
He expects mild-to-moderate trade-in quantity in coming months with used truck costs persevering with to fall.