REPORT: “Demand For Used Trucks Is Waning,” Orders Plummet 14%
Little Rock, Arkansas – Preliminary order totals for used Class 8 trucks are in for May and it’s not pretty.
According to trucking industry analyst, ACT Research, preliminary used Class 8 volumes (same dealer sales) fell 14% month-over-month in May.
This marks the second consecutive sequential drop, ACT said.
Additionally, the report indicated that longer-term comparisons yielded a 22% decline compared to May 2018, as well as a year-to-date drop of 16%.
Other data released in ACT’s preliminary report included year-over-year comparisons for May 2019, which showed that average prices rose 5%, while average miles shed 1%, and average age increased 7%.
According to Steve Tam, Vice President at ACT Research, “A spring slowdown is not uncommon, and sales generally increase a bit in the summer, but with the headwinds in the freight market, that is unlikely.”
He continued, “Those who watch the industry closely have been expecting the strong pricing environment to soften this year, and based on preliminary May data, it appears as though that transition may have started.”
Tam added, “In the context of lower unit sales and rising inventory levels, the slowing price appreciation is a strong indication that demand for used trucks is waning. Given a similar story in the freight market, the development makes sense.”
New Class 8 Orders Fall To Lowest Level In 3 Years
Class 8 truck orders fell to its lowest level in almost three years in May according to data compiled by ACT and FTR.
ACT Research reported preliminary North America Class 8 net order data showed the industry booked 10,800 units in May, while FTR tracked that number at 10,400 units.
May’s preliminary order data reflects a drop of more than 25% from April’s slow activity.
This is the lowest volume for Class 8 orders since July 2016 and the weakest month of May since 2009.
Class 8 orders for the past 12 months now total 360,000 units.
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(Image courtesy of Coopersburg & Liberty Kenworth)