It’s no secret that the value of used trucks has reached astronomical highs.
My team has seen sleepers with up to 600,000 miles sell for $80,000 and $90,000. In a normal market, those same trucks would have sold for closer to $40,000.
A host of reasons are to blame, including a shortage of new vehicles and the large amount of freight that needed to be moved immediately following the lockdown phase of the pandemic.
In recent months, we’ve been transitioning into a different market where equipment values are falling very quickly. Tonnage has been down overall, and due to that, spot freight rates have dropped significantly. This, along with skyrocketing fuel prices, has put huge pricing pressure on truckers and squeezed profits. Some are being forced to sell some of their idle or unprofitable trucks. This means more trucks entering the used market.
Used trucks are a commodity, so when supply increases and demand falls, prices decrease. In this instance, the drop has been dramatic. And it’s not just the price of Class 8 tractors that are falling. Medium- and light-duty trucks and trailer prices are falling too. They are just not going down as fast as the prices of Class 8 units.
Market demand for freight movement, the subsequent change in freight rates and high fuel prices will dictate the market. One factor that will help balance the equation is the continued shortage of new trucks, and that may continue for years to come.
