SAN ANTONIO, TX. Strong sales of Class 8 trucks in 2014 – which picked up considerably in November and December – should continue into 2015, noted W. M. “Rusty” Rush, chairman, CEO, and president of Rush Enterprises, though he believes that’ll be hard to sustain into 2016.
“Obviously truck sales have been out of sight this year, especially over the last two months,” Rush explained in a sit down with reporters here during the ninth annual Rush Truck Centers (RTC) Technician Skills Rodeo.
“We think U.S. retail Class 8 sales will end the year between 225,000 and 230,000 and may increase to 250,000 in 2015,” he said. “Business is good and we’re beginning to see small and medium fleets getting back into the market and I expect that [truck] replacement volume to continue.”
Rush cautioned however, that it “will be interesting to see” if that expected 250,000 Class 8 unit retail sales pace expected for next year “can be sustained” into 2016.
Yet one reason he is more confident than not concerning such “sustainability” is that Class 8 sales in his view still have yet to “catch up” from the valleys that occurred due to emission control system mandates and the tough economic times engendered by the Great Recession.
“Averaged out, the Class 8 sales cycle runs about 190,000 to 200,000 units a year. From that perspective, we still haven’t made up the shortfall” experienced back in the 2008-2010 timeframe, when Class 8 sales dropped at one point dropped under 100,000 units.
On the used truck side of the business, Rush said sales remain strong but believes valuations are “peaking,” though he doesn’t expect them to fall dramatically any time soon.
“It doesn’t mean they’ll crater,” he stressed in terms of used truck valuations. “We also expect mileage [on used trucks] to start coming down once we clean out the last of the 2009 and 2010 models. As we finish with those, we expect [odometer] mileage [at trade in] to decrease.”
Rush also pointed out expansion efforts will continue for RTC’s dealership network.
After completing six acquisitions in 2014 that added 35 stores to RTC’s network – growing it to 110 locations in 20 states – Rush said new stores are planned for Cincinnati, Buffalo, Denver and Columbus, with one in Cleveland to be opened next February.
Altogether – with acquisitions, new facilities, plus store expansions and updates added in – Rush said the company has invested $100 million in its expansion efforts in recent years.
“We don’t buy more stores just for the sake of buying more stores; we look to invest where it makes sense,” he explained. “What we’re focused on is keeping the customer up and running and that drives our network map in terms of the areas [within the U.S.] where we still need to get into.”
