The used truck sales industry in the United States has gone ballistic in the past twelve months, but there are some signs runaway prices are settling down.
ACT Research has found the value of a used Class 8 truck (basically heavy-duty trucks/prime-movers) increased around 75% between April last year and April 2022.
What’s steering the rapid growth? Basic demand and supply – road transport businesses need trucks, but new trucks are hard to come by.
That makes anyone selling used trucks in the U.S. in recent times a person with a strong negotiating position.
But the big spike in used truck values might be starting to slow down.
The latest report from ACT Research out today shows used truck sales for April were down 24%. Year over year, sales volumes were down 40%.
ACT experts expect that trend to continue, potentially through to August.
Average prices were down 1% compared to March, but 75% more expensive than in April of 2021.
“Same dealer retail sales of used Class 8 trucks took a bit of a tumble in April. While normal seasonality predicted an 8% decline, lumpy new truck sales and the lack of used truck inventory are the more likely culprits in April’s slowing,” – Steve Tam, vice president at ACT Research.
“Waning April new truck sales portend more weakness ahead in the secondary market, though March’s uptick has yet to make its way through the inventory maze.
“The April deficit marks the 10th straight month of shrinking year-over-year sales, which have been hamstrung by the curtailed flow of units into used truck inventory.
“A peek ahead at near-term expectations suggests sales are usually below average in May, then return to normal in June and July before picking up in August.”
Tam also discussed the impact of supply chain disruptions on the truck market.
“While the OEMs aspire to higher new truck production and sales, which would presumably benefit the used truck market, the relief they seek on the supply-chain front has proven elusive.”
He concluded by discussing demand, saying, “Inflation persists in taking its toll on consumer confidence and spending.
“While the spot freight markets have borne the brunt of the initial slowing, contract markets are not expected to escape unscathed.
“Collectively, lower demand for trucks at the same time capacity additions are still occurring are having the predicted and understandable effect of driving prices for both freight hauling and used trucks lower.”