Used construction inventory wanes ahead of yearend purge

Construction equipment dealers may be looking to purge aging machines in the coming months to refresh retail and rental fleets in a competitive market.  

The used construction equipment market has benefited from a robust financing environment and strong rental demand in 2025, driven by large commercial developments. In fact, megaproject starts are projected to more than double to $652 billion in 2025, according to construction data and solutions provider Dodge Construction Network.  

Many dealers have steadily expanded their rental fleets to capitalize on market tailwinds, but this trend is bound to create “a glut of rental inventory needing to be sold,” Jim Ryan, equipment lease and finance manager at Sandhills Global, told Equipment Finance News.  

“You can get [used equipment] off your retail side now and move it into the rental, but at some point, that’s going to hit its life expectancy where it needs to be sold.”  

— Jim Ryan, equipment lease and finance manager, Sandhills Global

Ryan said he expects most dealers to offload high-hour used equipment at the end of the year, while continuing to transfer later-model machines to rental from retail. However, dealers must consider if this strategy truly solves challenges tied to selling late-model equipment, he said. 

“You’re moving it now, and it’s working, but is it really fixing the problem? It’s delaying it,” he said. 

Meanwhile, used medium- and heavy-duty construction equipment inventory fell year over year in October amid strong market fundamentals overall, but they ticked up month over month as peak construction season ended, according to Sandhills. 

Used heavy-duty equipment 

• Inventory dropped 7.4% YoY, but rose 2.1% MoM; 
• The used crawler excavator market drove the YoY decline, down 9.3%; 
• Asking values dipped 1.2% YoY, but rose 0.9% MoM; and 
• Auction values increased 2.6% YoY and 0.5% MoM. 

Used medium-duty equipment  

• Inventory declined 6.8% YoY, but ticked up 0.3% MoM; 
• The used mini excavator market saw the largest YoY drop, 15.2%; 
• Asking values fell 0.9% YoY and 0.7% MoM; and 
• Auction values climbed 0.8% but dipped 1% MoM. 

Dealer-lender collaboration 

Financing is poised to play a crucial role in dealers’ offloading strategies in the coming months.  

Thus, dealers and lenders must make sure they’re on the same page when determining a machine’s value, Ryan said. 

A thorough inspection is one way to achieve this, John Gougeon, president and chief executive of UniFi Equipment Finance, said during EFN’s Oct. 21 used-equipment webinar.  

“It all comes down to condition, condition, condition,” he said. “I think the biggest miss for finance companies is not taking the extra step to fully understand what condition that used equipment is in.” 

Shared remarketing programs also motivate dealers and lenders to collaborate to offload used machines, Gougeon said. 

“Whether it’s a residual-share program or a marketing program in place where that asset has multiple lives and multiple finance lives, and I’m working with my dealer, when the equipment comes back and they benefit from that, everybody wins,” he said. 

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