By Joseph Evangelist
Executive Vice President, Transervice
As originally appeared in FleetOwner Magazine’s IdeaXchange
As we know, all three segments of the used truck market — retail, auction and wholesale — can fluctuate on a month-to-month basis. The volume of trucks available and the influx of later model year vehicles cause these fluctuations.
Recently we’ve seen an increase in the average age of used trucks, up 8% year-over-year, as fleets seem to be hanging on to their trucks longer. That means when they enter the used truck market they do so with higher mileage numbers. In fact, 500,000 miles is the average mileage on sleeper tractors that are in the used truck market today, while tandem day cabs are at around 400,000 miles.
If trucks have more than 600,000 miles they will have little value in the U.S. used truck market but might do well on the export market. Mexico, Vietnam, Canada and Nigeria are leading the export volume list.
However, mileage is not the only factor that influences resale value. Vehicle age along with specifications play a role. There are some components that add value at resale and others that lower the resale value. And don’t forget about appearance. The way a truck looks also counts. It’s probably worth it to spend a little time shining the chrome and making other cosmetic improvements before trying to sell a truck.
Even “make” of truck matters and based on user preference, two trucks of similar age and mileage can see a 4% to 5% price differential based on brand.
Going forward through 2020, I am expecting 2013 and 2014 model year trucks to start surging into the used truck market and I predict that will keep the value of used trucks currently on the market at low levels.