Low-mileage trucks are still bringing respectable money, while average to higher-mileage units are depreciating more heavily. Fleets simply don’t need as many trucks as they did last year. The freight environment is actually still fairly strong, albeit cooler than last year’s superheated environment. We are simply on the back side of an order and delivery cycle that was more volatile than usual.
The average sleeper tractor retailed in September was 69 months old, had 457,111 miles, and brought $52,249. Compared to August, the average sleeper was 1 month newer, had 14,616 (3.3%) more miles, and brought $2,441 (4.5%) less money. Compared to September 2018, this average sleeper was 1 month older, had 1,974 (0.4%) more miles, and brought $4,203 (7.4%) less money.
Looking at trucks two to five years of age, September’s average pricing was as follows:
Model year 2018: $111,807; $3,492 (3.2%) higher than August
Model year 2017: $80,022; $2,085 (2.5%) lower than August
Model year 2016: $62,223; $3,105 (4.8%) lower than August
Model year 2015: $45,487; $3,204 (6.6%) lower than August
Year-over-year, late-model trucks sold in the first nine months of 2019 brought 7.9% more money than in the same period of 2018. Depreciation in the first nine months of 2019 averaged 1.6% per month, compared to well under 1% in the same period of 2018. Keep in mind these positive results are due entirely to market strength in the first half of the year. Conditions have changed to the point where a narrower year-over-year comparison - for example September 2019 vs. September 2018 –shows a negative result.
Supply will remain a problem into 2020. We’ve all seen the boom-bust cycle before, and this one is more volatile than usual due to the economic stimuli of 2018 (which juiced the economy in the short term) and the ongoing trade war (which is impairing the manufacturing sector).