November 21, 2013
In the past 18 months, demand for late-model used trucks has accelerated, while demand for new trucks has marginally decreased.
An increased number of used 2009-2011 model year trucks is available to the secondary market, bolstering overall average pricing, while demand for new trucks has fluctuated based on general business confidence.
“Ongoing economic uncertainty driven by political brinksmanship keeps fleets from making big bets on expansion,” says Chris Visser, senior analyst for the ATD-NADA Commercial Truck Guide. “Late-model used trucks remain an attractive alternative, which is why they continue to command record pricing.”
According to Visser, deliveries of new truck sales were closely correlated to used retail sleeper tractor pricing from late 2009 through mid-2012. Since mid-2012, these two indicators have diverged, with sales trending generally downward, and pricing initially stable and then sharply upward.
An increase in the proportion of 2009-2011 model year trucks sold is primarily responsible for the increased pricing, Visser says. These model years were hit by the recession, representing a substantial decrease in build rate compared to the 2006 and 2007 model years.
Model year 2009-2011 trucks feature low mileage, and thanks to the low build rate, are not available to the secondary market in mass quantities. At the same time, these trucks are 3 to 5 years old and entering prime trade-in age.
“As such, any trucks that become available command a high price,” Visser says.
With new trucks more expensive than any time in recent history, Visser adds low-mileage used trucks – even at historically high prices – remain an attractive substitute.
“New truck orders and sales are dependent on an economy that is subject to fluctuating degrees of business and consumer confidence,” he says. “Used trucks remain the safe bet.”