Preliminary used Class 8 retail volumes, or same dealer sales, in December increased 20% over the prior month but were 25% lower compared to December 2021, according to industry data aggregator ACT Research.
Other data, which ACT also takes from its ongoing State of the Industry: U.S. Classes 3-8 Used Trucks report, showed that average retail price and miles declined last month 1% and 4%, respectively, while average age declined 1% from the readings ACT took in November, the research firm said in a release. Compared to December 2021, retail price and miles declined by 3%, while age increased by 2%.
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“The economy, freight market, and even the commercial vehicle industry are sprinkled with bits of data that suggest the situation might be better than some originally envisioned. December used-truck volumes are one of those data points,” said Steve Tam, VP at ACT.
“History suggests sales usually tick in at year-end, but the 20% [month-over-month] increase was more than three times the typical growth rate,” Tam added. “Despite all the downside projections floating around today, there is still solid demand for used trucks of all vintages. Supply also seems to be increasing, thanks to better new truck sales.”
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 report provides the average selling price for top-selling used Class 8 models for each of the major truck OEMs: Freightliner (Daimler), Kenworth and Peterbilt (Paccar), International (Navistar), and Volvo and Mack (Volvo).
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Tam concluded, “Demand has cooled to the point that prices will continue to come down. And they are running smack dab into the toughest comparisons they have ever faced. The ride is going to be a rough one, but when the industry comes out of the other end of the cycle, we believe prices will bottom above the low point of the previous cycle’s trough. Then it will be off to the races as the cycle resets.”
New truck orders for December settle at 30,600
ACT on Dec. 17 reported in a separate release its final truck orders data for December, revising its number higher by 300 new vehicles than was reflected in preliminary data the research firm released earlier this month.
ACT said the final truck orders number from December was 30,600 versus its preliminary estimate of 30,300, which ACT said capped a healthy final four months of 2022, even though orders slid for the third straight month following a record September.
“For now, business activity in the truck industry rolls on, also seemingly unphased by higher interest rates, as pent-up demand remains for now,” said Eric Crawford, ACT VP and senior analyst. “We expect this dynamic to shift in [the second half of 2023], as the Fed continues its aggressive push to subdue inflation. Although there have been recent signs of inflation slowing, we do not expect the Fed to begin cutting rates in 2023.”
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Meanwhile, Class 8 retail sales in December rose 19% over the same month last year to an all-time record of 34,415, Crawford reported, adding that “the strong finish to the year led to a total of 309,615 units sold in 2022.”
Classes 5-7 retail sales rose 3.6% over December to 19,000 units. Full-year retail sales were 229,821.
