Used Truck Sales in January Rise 17% From Prior Year
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Used Class 8 truck sales in January increased 17.3% compared with the same period the prior year, ACT Research reported.
Sales for the month increased to 21,700 units from 18,500 and also experienced a sequential rise of 11.3% from 19,500 units in December. The average retail sale price fell 20.4% to $59,360 from $74,612 during the year-ago period but increased 1.8% from $58,324 the prior month. Average mileage for used trucks decreased 10% to 414,000 from 460,000 a year prior and increased 1.2% from 409,000 the prior month.
“Our pricing expectations remain steady, with a return to [month-to-month] growth toward the end of 2024 as the most likely course,” ACT Vice President Steve Tam said. “Combined market results saw volumes increasing 46% [year-over-year]. Expectations for 2024 call for moderate growth relative to 2023.”
Ritchie Bros. Auctioneers has been managing the sale of rolling stock assets from the closure of Yellow Corp. The inventory consists of large quantities of trailers, flatbed trucks, truck tractors and other forms of equipment. Nations Capital has been assisting in that process.
Tam
RELATED: First Yellow Trucks and Trailers Up for Auction March 5
“RBG, along with Nations Capital, was awarded the Yellow Corp. package in late 2023 and has already begun selling the equipment through a variety of our platforms, with the bulk of the equipment being tractors and trailers,” said Rob Slavin, senior valuation analyst at Ritchie Bros. “The ‘once in a lifetime’ used truck/trailer values seen in late ’21/early ’22 has come and gone to a more normalized market value.”
Slavin noted that with market conditions defined by a freight recession and an oversupply of drivers for some carriers, repossessions and fleet downsizing are becoming more common. He pointed out that while the cost of diesel has improved from the prior year, it’s still high compared with previous years.
Bowles
“Contrary to a simple surge in buyer interest, the data suggest a more nuanced landscape driving these fluctuations,” added Charles Bowles, director of strategic initiatives for Commercial Truck Trader. “Primarily, we’re witnessing a contraction in the active buyer base within this segment, necessitating dealers ramp up their marketing efforts to capture the diminished pool of potential purchasers.”
Bowles noted that successful dealers are committed to cultivating leads and adopting a more consultative approach. He said they are departing from the approach adopted during the COVID-19 pandemic when buyers were inclined to pay a premium regardless of the cost.
Golden
“January was not good, but February looks better, which is not typical,” said Trey Golden, vice president of used truck sales at Rush Enterprises. “January and February are usually always bad. But February is usually kind of the worst of the worst, and we’re definitely going to uptick from January to February.”
Golden noted that February this year has been a bit different for his operations thanks to fewer weather-related disruptions and an extra day to sell trucks thanks to leap year.
“We’re not seeing these headlines where we had to close for three days in all of Georgia, things like that,” Golden said. “It always seems to happen in Q1 where we lose some working days in a part of the country. So geographically speaking, I think, the places that really tend to get hammered by winter were better off this year. I don’t know if that means that we don’t get the pickup in March, because March is usually really good, but that’s also coming off those really [crummy] weather-related months.” Golden also expressed skepticism over pricing going up while volumes go down.
Smith
Charles Smith, regional business development and marketing manager at Mission Financial Services, noted that some of the swings in the market right now are predictable, such as buyers securing the equipment they need before the presidential election or in anticipation of potential changes in interest rates. He said a lot of his customers have been in the industry a long time and know what to do during a downturn.
“It started out slow on the finance side with us at Mission, and all of a sudden, we just started to see an increase in applications come through, an increase in approval and an increase in guys actually financing used trucks,” Smith said. “I think pricing was a key as well as the economy. A lot of people are looking at that.
“Hopefully, this industry will start to swing upward, like the analysts say, in the second quarter, going into the third, to where the mom and pop dealerships, or the independent owner-operators, can actually start back up making money.”
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