Used tractor sales surge through summer slowdown
An influx of late-model sleeper tractors coming off trade continued in June, pushing the universal retail average down about 3 percent from May. The average sleeper tractor retailed in June for $57,138, had 521,586 miles, and was 78 months old, ATD says.
“Drilling deeper, we see that this influx of late-model trucks is represented primarily by those with less than 400,000 miles,” says ATD senior analyst Chris Visser. “In fact, the number of trucks with that mileage sold in the first half of 2014 is already greater than in all of 2013. These trucks are still early in their usable lifespan, and they’re also half the price of a new truck. As such, demand for this cohort will remain strong, limiting depreciation.”
Prices remain at historically high levels, and Visser says he expect that to remain the case for the remainder of the year.
“At the same time, we are unlikely to see record-breaking pricing again, and we continue to forecast depreciation for 2013-2010 model year trucks on the order of roughly 1.5 percent per month,” he says.
At the halfway point of 2014, the number of lower-mileage sleeper tractors reported sold at auction or dealer-to-dealer is notably higher than last year as are the the number of older, higher-mileage trucks.
“Increased recon/rebuild business for pre-2007-emissions trucks is the likely factor here,” Visser says. “If an older truck is bought right, it is possible to turn a profit on the retail end even after an overhaul and reconditioning are completed.”
The average sleeper tractor sold wholesale in June brought $40,491, had 615,771 miles, and was 77 months old.
“The market’s hunger for low-mileage sleeper tractors is evident in the continued high pricing in the face of increased supply,” Visser says. “Trucks will depreciate at a mild and predictable rate through the end of the year, with strong demand limiting the rate of decline. Increased numbers of lower-mileage trucks coming off trade means increased business. It’s time to make hay while the sun shines.”