The shortage this year of new Class 8 trucks—largely because of parts and component shortages that are causing OEM production delays and order reshuffling—seem to be affecting the used-truck market, where volumes at dealerships are down significantly and prices continue to rise, according to new preliminary data for November from ACT Research.
Used-vehicle volume is heading in the opposite direction of prices, ACT’s data show, apparently reflecting continued demand for pre-owned trucks at least in part because new heavy commercial vehicles will be harder to come by well into 2022.
“As has been the case since late 2020, the industry’s inability to meet truckers’ equipment needs has resulted in unrelenting used-truck price escalation,” Steve Tam, vice president at ACT Research, said at the release of ACT’s latest report on Dec. 16.
See also: Class 8 order drop reflects lack of confidence in supply chain
Earlier this month, FTR Transportation Intelligence reported that net North American orders for new Class 8s dropped in November 41% from October and were down 82% year-over-year. Orders were the lowest for the month of November since 1995, according to FTR.
Preliminary used Class 8 retail volumes (same dealer sales) decreased 22% month-over-month and dropped 23% year-over-year last month, ACT reported. However, through the first 11 months of the year, activity is 10% higher compared to the same period of 2020, according to the ACT Research report.
ACT data earlier this month also showed net Class 8 order volatility in November. Preliminary Class 8 orders last month were 9,800 units, while Classes 5-7 net orders dropped to 21,500 units, both representing lower sequential and year-over-year readings, ACT reported.
“Preliminary same dealer sales moved deeper into negative territory in November,” Tam said on release of ACT’s latest report. “Historically, the sequential decline in November was very characteristic, as November is the second weakest sales month of the year.”
Other data released in ACT’s preliminary report included month-over-month comparisons for November, which showed that average prices rose 11%, as average miles dropped 3% compared to October. Average age was flat month-to-month.
Compared to November 2020, the average price of a used truck is 69% higher, with average miles and age greater by 3% and 8%, respectively. Year-to-date, average price is 40% above its year-ago level for the first 11 months of 2020, with average miles unchanged and age up 1% year-to-date.
ACT’s Classes 3-8 used-truck report provides data on the average selling price, miles, and age based on a sample of industry data. In addition, the ACT report provides the average selling price for top-selling Class 8 models for each of the major truck OEMs, Freightliner (Daimler), Kenworth and Peterbilt (Paccar), International (Navistar), and Volvo and Mack (Volvo).
According to ACT, this report is used by those throughout the industry, including commercial vehicle dealers to gain a better understanding of the used-truck market, especially as it relates to changes in near-term performance.
“Despite the current softness, sales continue to outperform [on a year-to-date basis] and are now 10% higher with just one month remaining in the year,” Tam continued. “Even though inventory is tight, it has not stopped flowing. New truck activity continues to feed the seemingly insatiable demand from owner-operators and fleets alike.”
ACT’s monthly report covers an estimated 25% of the used-truck market. Dealer remarketers and independent dealerships report transaction-level data monthly and this data, combined with ACT’s other work, provide insight into the total capacity of the market.
