New truck sales at dealerships are plummeting as the financing climate tightens, but favorable used-truck deals are providing some relief.
Dealers reported a 13.9% year-over-year decrease in new truck orders in the first quarter, according to an April 11 report by heavy-equipment research firm IronAdvisor Insights. The report comprised responses from dealers representing 35 locations, along with responses from fleet operators and other industry professionals.
Tariff uncertainty
Low freight rates, high interest rates, tariff-fueled uncertainty and increased new-truck prices are creating hesitancy among lenders, according to the report. Plus, many lenders are wary of a trucking industry that only recently started recovering from a yearslong recession, IronAdvisor Director of Research Jarrett Harris told Equipment Finance News.
“I think lenders have a heightened sensitivity to market dynamics, whether that be interest rates, the credit worthiness of the fleets and owner operators or some of the other pricing dynamics,” he said. “It doesn’t take much for them to get a little bit nervous, and we’ve had more than enough to get nervous about.”
New truck prices rose 3% YoY in Q1, which surprised several dealers given that new inventory levels were relatively high, according to the report. Increased prices have added to financing woes as lenders require larger down payments, Harris said.
“That already wide disconnect between the financial health of a fleet and the price of a new truck is just getting a little bit wider.”
— Jarrett Harris, director of research, IronAdvisor Insights
President Donald Trump’s tariffs are also pressuring dealers as truck OEMs add surcharges to new vehicles, typically ranging from $3,500 to $4,000, Harris said. These surcharges are occurring regardless of whether the truck was made domestically or abroad, he said.
Lenders seek efficient dealers
Commercial truck dealers looking to work with new lenders must emphasize efficiency to give them confidence, Kirk Mann, executive vice president and head of transportation at Mitsubishi HC Capital America told EFN during a question-and-answer session at the recent Commercial Vehicle Business Summit.
“At the end of the day, lenders only have so much capacity for so many relationships and so many applications that are coming at the door,” he said. “So, we have to make sure that we are doing business with dealers that are efficient. … How many applications are coming to the door, and how many of those applications are we booking? Because it costs us money to look at every single deal that comes in the door.”
In addition, dealers should be prepared to discuss their customer base, average deal size and how many deals they expect to close each month, Mann said.
Used-truck market a silver lining?
As new trucks become increasingly unaffordable and difficult to finance, more fleet operators are turning to the used-truck market to meet replacement demand. While used-truck prices appear to be bottoming out, they’ve fallen significantly in recent years, creating favorable deals for fleet owners, Harris said.
“I think that there is a replacement need, and you’ve got a lot of aged fleets out there,” he said. “So, we are seeing a lot of people talk about either [renewing warranties] and just running it into the ground, or search the market for that 350,000-, 400,000-mile truck that they can still get another 400,000 miles out of.”
However, the growing gap between new and used truck prices is creating imbalanced market dynamics.
“Six years ago, a 5-year-old used truck with 500,000 miles on it was worth $45,000 to $60,000, and new was worth $140,000,” a Traton dealer stated in the report. “Now, new is $195,000 and that 5-year-old used truck is worth $22,000 to $23,000.”
The third annual Equipment Finance Connect at the JW Marriott Nashville in Nashville, Tenn., on May 14-15, 2025, is the only event that brings together equipment dealers and lenders to share insights, attend discussions on crucial industry topics and network with peers. Learn more about the event and register here.
