Volume Dropped but Pricing was Stable in April
Auction and retail pricing in April 2024 was very similar to March, which we consider a mild upside surprise given the drop in sales volume.
CLASS 8 AUCTION UPDATE
Auction volume of Class 8 sleeper tractors pulled back in April, which is typical for the month. On a mileage-adjusted basis, pricing for these trucks was little changed from March. However, anyone tracking the large number of trucks with very high mileage for their age would be excused for feeling like trucks were bringing less money.
Looking at late-model sleeper tractors, average pricing for our benchmark truck in April was:
Model year 2021: $50,173; $357 (0.7%) higher than March
Model year 2020: $32,433; $640 (2.0%) higher than March
Model year 2019: $26,749; $457 (1.7%) lower than March
Model year 2018: $19,301; $2,197 (10.2%) lower than March
We have eliminated the 2022 model year from this table due to very low volume of trucks sold, which resulted in swings in the averages that were not reflective of the market. We will add this model year back in when volume increases. Otherwise, in April, four- to six-year-old sleepers brought essentially equal money to March, and 21.4% less money than in April 2023. Values for this age group are now about 7% lower than the strong pre-pandemic period of 2018 in nominal figures, or about 23% lower if adjusted for inflation. Current pricing is about 43% higher than the last market nadir in late 2019, or about 18% higher if adjusted for inflation. Depreciation in 2024 is averaging 5.6% per month. Pricing is now roughly halfway between 2018 (strong) and 2019 (weak) levels in real numbers.
Two industry metrics that generally correlate to used truck values, capacity utilization and freight rates, suggest truck pricing still has some depreciation to work through. Capacity utilization estimates put us much closer to 2019 than 2018 currently, and both spot and contract freight rates are below 2019 in real numbers. As such, April’s results were somewhat stronger than expected.
