Prices for most vehicles in April at both the retail and auction levels were down slightly from March. But they fell much more than in February.
For example, mid-year 2022 Class 8 tractors sold for an average retail price in April of $95,365, according to the report. That was 5.4% less than in March, a drop of $5,379.
But the decline since February has been much sharper. The price that month for used 2022 Class 8 tractors sold at retail was $128,768. The April price reflects a drop of nearly 26% in two months.
JD Power said it did not release sales figures for the 2022 vehicles sold at auction “due to the very low volume of trucks sold, resulting in fluctuations in averages that do not reflect the market”.
Model year 2021 vehicles sold at auction in April brought an average price of $50,173, JD Power said, which was just 0.7 percent higher than March’s price. But the February price was $54,477, for a drop in just two months of 7.9%.
Other changes in April compared to March show a market that was mostly flat. For example, prices for 2020 model vehicles sold at auction were 2% higher than in March, the auction price for 2019 vehicles was 1.7% lower, and the auction price for 2018 vehicles was down by 10.2%.
Retail sales in April also showed a mix of gains and declines. Model year 2021 and 2020 vehicles were both higher in price than in March, 5.8% and 1.6%, respectively, while 2019 and 2018 retail prices were down from March, 0, 6% and 0.9%, respectively.
However, prices in April compared to February showed a noticeable drop. At auction, Class 8 tractors from 2020 dropped to $32,433 from $37,064. The drop for 2019 was $26,749 from $31,117 and for 2018 it was $19,301 from $24,791.
At retail, the comparison between April and February prices was $74,543 vs. $77,939 for the 2021 models, $55,868 vs. $60,939 for the 2020, and $43,524 vs. $45,424 for the 2019.
Some of those smaller reductions will be more in line with normal depreciation, which JD Power this year said averaged 2.3 percent a month, consistent with historical performance.
As JD Power’s commentary in the report notes, prices even after the recent reductions remain elevated in part because of how they soared during the pandemic.
“Late-model squeezes are bringing in money comparable to the last strong pre-pandemic period in late 2018 in nominal dollars, or about 19% less when adjusted for inflation,” the report said. “Compared to the last weak period before the pandemic, sleeper end model prices are now 30% higher in nominal dollars or 7% higher in real dollars.”
But markets are about more than prices. In its commentary, JD Power said: “April’s retail environment was unexpectedly weak, with sales per roof averaging a dismal 2.1 trucks.”
In an email to FreightWaves, JD Power senior analyst Chris Visser said the metric — sales per rooftop — is calculated by taking the “total number of dealership rooftops (individual locations) reporting sales divided by the total number of sales that were mentioned”.
Visser added that the number generally averages around 5.0, “and we are significantly below that post-pandemic.”
He also noted that the figure is adjusted for outliers or sales for which JD Power cannot obtain “critical data,” such as mileage. “Most roofs will move a lot more trucks in the real world than our average shows, but our methodology has been consistent over time, so it’s a valid ongoing comparison,” Visser said.
As for April’s weakness, the report said the month is “not typically a weak month
retail sales, so we could be entering the spring recession a little early.”
The overall downtrend at the lower prices is reflected in this chart. The numbers are an average of prices for used 3, 4 and 5 year old trucks with an aerodynamic body type.
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