Truck Parts Pricing to Come Down from Historic Highs

The rate of aftermarket truck parts price increases is expected to slow in 2023, following two years of historically high price jumps, according to a MacKay & Company analyst who presented during the Heavy Duty Aftermarket Dialogue outlook conference in Texas on Jan. 16.

MacKay & Company tracks an average parts price increase every year based on feedback it receives from parts distributors. Between 1990 and 2020, the average parts price increase has been about 1.9%, according to distributor feedback. But in 2022, the year-over-year percent change in parts pricing spiked to an all-time high of 10.2%.

The jump is attributed to inflation, as well as price setters raising prices due to the high the demand for parts coming out of the COVID-19 pandemic, which lead to supply chain constraints, Dave Kalvelage, MacKay & Company client consultant and analyst, said.

In 2023, the firm is forecasting a drop to about a 3.5% price increase.

“That may be a little optimistic or conservative,” Kalvelage said. “Especially when we just heard some of the other panelists [at HDAD, saying] they're seeing pricing in the range of 4 to 6%. But that’s our initial look at it. I think pricing is going to come down to how much we don't know, and we certainly may adjust this throughout the year.”

U.S. Truck Part Demand in 2023 and Beyond

MacKay & Company calculates the demand of aftermarket parts based on a model that multiples per truck unit demand by the average retail price of parts.

The unit demand is calculated by tracking the total number of trucks operating in the industry and the age of the vehicles in that population. MacKay & Company supplements those numbers with surveys which ask fleets to supply data on miles driven, utilization, replacement types and more.

Aftermarket truck part demand in 2022 was up 17.7% year-over-year, and the forecast for 2023 has a 4% compound annual growth rate.

MacKay forecasts over a five-year period, assuming similar conditions, truck population and utilization. Beyond 2023, prices are forecasted to drop back to 2%, with a growth at 4% for the compounded average over the forecast.

“These numbers will certainly change if we fall into a recession,” Kalvelage speculated. “Utilization will get impacted, and possibly annual miles. But this is where we are at right now with current conditions.”

[Editor's Note: This article was updated on Jan. 30 at 3:50 p.m. CT to clarify that the rate of the truck parts price increase is expected to slow, rather than parts pricing decreasing, as previously stated.]