Used-Truck Registrations Surge 10% as Fleets Replace Oldest Equipment

This story appears in the Sept. 9 print edition of Transport Topics.

Registrations of used heavy-duty trucks increased 10% in the first half of 2013 from a year earlier as fleets replaced their oldest vehicles, R.L. Polk & Co. reported.

Used Class 8 registrations totaled 140,300 through June, accounting for 61% of all registration changes in the first half, compared with 56% in the first six months of 2012, according to Polk.

“I think there’s decent business out there, but . . . [carriers] aren’t just going to go out there and expand their fleet without having a good, long-term customer so they can be assured that the uptime is going to be there,” said Gary Meteer, Polk’s director in charge of commercial-vehicle data.

As newer equipment enters the used market, small and midsize carriers are buying it to replace the “extremely old” vehicles, Meteer said.

Large fleets aren’t buying as many new trucks, Meteer added. While used-truck transactions rose, first-half registrations of new Class 8 trucks dropped 9.9% from a year ago, Polk said.

Year-to-date sales data from ACT Research presented a less positive picture of the used-truck market than Polk’s report.

ACT said the sellers it surveys have sold 16,702 used Class 8 trucks through July, down 9% from 18,360 a year earlier. The firm’s used-truck survey represents roughly 10% of the market and includes retail, wholesale and auction sales.

Dealers continue to cite a shortage of low-mileage used trucks, ACT Vice President Steve Tam said.

“For the dealers we talk to, it’s several things — it’s [the lack of] availability of desirable equipment, and then if you have that equipment, you’re still up against the realities of this slow-growth economy that we’re in,” Tam said.

In July, used-truck sales rose 3.7% from the previous month but were still down 19.1% from sales volumes a year earlier, according to ACT. Used-truck data for August were not yet available.

ACT said the sellers it surveys reported 2,128 used-truck sales in July, down from the 2,630 sold in the same month in 2012 but up from 2,053 in June.

The average price for a used truck sold in July was $39,656, down from $41,905 a year ago but up slightly from $39,442 in June, according to ACT.

In a separate report, the American Truck Dealers said the average retail price for a used Class 8 sleeper with fewer than 1 million miles rose to $52,609 from $50,067 a year earlier. However, it was down from $52,673 in June.

ATD analyst Chris Visser said the year-over-year pricing increase reflects a decline in average mileage as more 2009 and 2010 model-year trucks enter the used market.

Average mileage in July declined to 536,623 from 557,364 a year earlier, he said.

Truck buyers “weren’t necessarily so hot” on the first trucks with diesel particulate filters designed to meet 2007 federal emissions standards, Visser said, but the 2010-technology trucks with selective catalytic reduction are “bringing some strong money.”

Curtis Johnson, vice president and co-owner at Tandem Truck Sales in Oak Grove, Mo., said dealers can’t find enough of the low-mileage trucks that buyers seek.

“The good stuff is becoming kind of unique to have, and the prices for it are going up,” he said, adding that overall sales volumes are about the same as last year.

At the same time, many customers still want trucks with engines that predate the 2007 federal emissions requirements, Johnson said.

However, those buyers are “going to get to the point where it becomes obsolete, so they’re going to have to get their feet wet” with newer engine technology, he said.

Rick Clark, vice president at National Truck Protection in Cranford, N.J., said his warranty sales for used trucks hit a record in August, in part because the available trucks have such high mileage.

Clark, who also is president of the Used Truck Association, said that eventually carriers will need to purchase equipment in larger quantities to replenish their aging fleets.

“They keep running these trucks with high mileage, and it’s got to change,” he said.