Generally, medium-duty segments are holding up well, with cabovers and lighter GVW conventional trucks performing the best.
by Staff
May 24, 2017
Average wholesale selling prices for four to seven year old Class 4 and Class 6 trucks (Source: JD Power)
2 min to read
Average wholesale selling prices for four to seven year old Class 4 and Class 6 trucks (Source: JD Power)
Commercial truck analysts at J.D. Power Valuation Services note in their May 2017 Commercial Truck Guidelines Industry Update that pricing of used commercial vehicles began to level out despite higher volume during April 2017.
Major findings in the free monthly report also point out:
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The used commercial truck retail channel is still showing typical depreciation.
Pricing should level out in the upcoming months.
Class 8 auction pricing has leveled out despite higher volume.
The average selling prices of late-model trucks are actually trending upward.
Medium-duty segments are generally holding up well. Cabovers and lighter GVW conventional trucks are performing the best.
Starting with Class 3-4 cabovers, the mix of trucks sold through auction and wholesale channels continued to trend newer, with lower-mileage. March’s average pricing was $22,475, which beat February’s five-year record. This figure was $981 (4.6%) higher than February, and $4,597 (25.7%) higher than March 2016. Unlike pricing, volume has not been particularly impressive in 2017. Buyers appear to be most interested in the newest, lowest mileage equipment.
Looking at conventionals, average pricing for both Class 4 and Class 6 pulled back in March, with Class 4 trucks continue to bring more money than Class 6. Specifically, Class 4 trucks averaged $21,060 in March. This figure is $3,418 (14%) lower than February, and $331 (1.6%) higher than March 2016. Class 6 trucks averaged $18,568 in March. This figure is $2,632 (12.4%) lower than February, and $2,816 (13.2%) lower than March 2017.
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Volume for Class 4 was identical to last month, while volume for Class 6 was moderately higher. Demand should continue to incrementally improve in upcoming months for trucks of all GVW classes
When asked about what flattening prices mean for the used commercial truck market, Chris Visser, senior commercial truck analyst at J.D. Power Valuation Services said, "This trend suggests the market is finding a bottom. Retail pricing still shows depreciation on par with late 2016, but we expect that channel to moderate as well."
So, what does this mean for the next few months? Visser went on to say, "Overall sentiment about the trucking economy is improving. It is possible we are finally seeing a degree of increased demand for used trucks. Values will continue to be impacted by returning supply, but the evidence is building that pricing has found its floor."
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