The used truck market is changing every day, says James Rys of House of Trucks. (House of Trucks via Facebook)

Used Class 8 sales in July decreased 9.3% year-over-year to 19,500 units from 21,500, ACT Research reported.

The average retail sale price for a used truck fell 25.4% to $64,897 from $86,987 during the year-ago period, and declined 5% month-over-month from $68,329 in June.

On a month-to-month basis, sales fell 9.3% from 21,500 units in June. Average mileage decreased 2% compared with the previous month, while the average age declined 1%.

“Sales usually dip a percentage point or two in July, so the decrease was in line with, but greater than, expectations,” said Steve Tam, vice president at ACT Research, in a statement. “Including auctions and wholesales, the total market volume fell 28% m/m in July. Compared to July 2022, the retail market was 19% larger.”

Tam noted the last month has provided more clarity on some evolving issues. Yellow Corp. going out of business has raised the question of where its equipment is going to go. UPS union workers were also able to ratify a five-year contract with the Teamsters.

“The UPS Teamsters ratified their contract, avoiding a disruptive strike,” Tam said. “Closer to home, the bankruptcy of Yellow appears to be progressing in a disciplined, methodical and orderly fashion. The company owns more than 14,000 trucks (primarily Class 8 day cabs) and nearly 45,000 trailers.”

Tam noted the approach being taken should help to minimize the negative impact on used equipment values. But he also warns that it is still very early in the process and there are no guarantees. Yellow was highly focused on the less-than-truckload segment.

“Basically, where we’re looking and where we’re always keeping on top of our market is trying to find out the right equipment,” said James Rys, general manager at House of Trucks. “Everything right now is based on your inventory, your mileage, your price level and the availability because the market is changing every day. But you have to have the equipment.”

Used sleeper cab

The third and fourth quarters are usually challenging for the used truck market. (Ameritruck)

Yellow equipment eventually entering the used market does present a challenge when it comes to figuring out what has become available and how it will impact business. Rys noted the third and fourth quarters are usually challenging anyway, with the situation adding to that.

“They’ll decide when they’re going to start to put that equipment in the market,” Rys said. “So that’s a challenge for us. Our used truck dealerships are all buying and selling in today’s market so you have to find out what’s available. So, we need to work together with the dealerships and also at both ends of our business cycle. Our customers either have a new account or they’re losing an account based on whatever the rates are today, because that’s another typical challenge for third and fourth quarter.”

J.D. Power found in its monthly market report that 3-year-old trucks sold at auction had unusually high mileage for their age as well as somewhat undesirable specs. But the consumer intelligence company doesn’t consider these averages representative of actual market movement. The report also noted that trucks with more typical mileage were flat compared to June.

“The late-model segment saw another uptick in pricing in July, with 4- to 6-year-old trucks bringing 2.3% more money than in June, but 25.1% less money than July 2022,” the report noted. “In the first seven months of 2023, late-model sleepers brought 43.4% less money than the same period of 2022. July’s uptick caused the year-to-date monthly depreciation average to relax even more to 5.1%.”

Rys also pointed out that the loosening new truck market has an impact. The truck manufacturers have worked through supply chain issues to increase output this year. But with the new equipment on the market that could mean carriers pushing more of their older trucks into the used market.

“There’s going to be a lot more trucks and the market is up with a good percentage of new equipment,” Rys said. “Now, the other side of that equation is where are the used trucks coming from, which fleets are actually moving them along, and which ones are the right spec, right mileage, which is really important at dealerships like House of Trucks.”

Rys added his dealership is working with its customers and dealers throughout the country to find the right equipment to meet their needs. But he has also noticed because of decreasing rates, many trucks are just being parked instead of going back onto the market.

“Customers are just saying with the rates being down, we can’t run all the equipment we would normally so that equipment might be parked,” Rys said. “The equipment, replacement, financing and repair costs are another issue for the fleet accounts in small companies that we do business with.”