The used-truck market improved last month as retail sales surged, with lenders becoming increasingly confident and dealers finding better ways to liquidate.
Same-dealer retail sales of used Class 8 trucks rose 56% year over year and 16% month over month in January, far surpassing seasonal expectations of an 11% MoM decrease, according to a Feb. 18 report by commercial trucking research firm ACT Research. That followed 24% YoY and 23% MoM increases in December.
The average used Class 8 price rose 3% MoM in January, further suggesting that used-truck prices have bottomed out, which should give lenders and fleet owners confidence to grow their businesses in 2025, Matt Manero, president of Carrollton, Texas-based Commercial Fleet Financing, said during Equipment Finance News’ Feb. 11 webinar.
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Concerns over financing an overpriced used truck “seems to have gone away for us,” Manero said. “We think it’s a great time for people to buy trucks. … We certainly are requiring some down payments on trucks that seem to be a little bit too rich or being priced at retail versus wholesale, or somewhere in the middle. But the market is open for finance.”
While interest rates may be slightly higher than they were several years ago, and loan terms shorter, “some of that is being offset, because the truck prices are so much lower than they were two or three years ago as well,” he said.
Lower prices present more opportunities for financiers and businesses, although some lenders are still “feeling the pain” from the yearslong trucking recession, Chris Grivas, president of Chadds Ford, Pa.-based CAG Truck Capital, told EFN.
“They’re being a little more conservative,” he said. “But people have short memories. So, I think those markets will open up again, and finance companies will start loosening the road.”
Dealers turn to wholesale, online platforms
Meanwhile, auction activity for used trucks plunged 80% MoM and 59% YoY in January, while wholesale transactions jumped 22% MoM and 68% YoY, according to the ACT report.
More dealers are turning to wholesale platforms and online marketplaces to liquidate used gear because auction values have dropped significantly in recent years, Kathryn Schifferle, founder and chief vision officer for dealer solutions provider Work Truck Solutions, told EFN. The company’s solutions include an online marketplace, a showroom and a sales prospecting platform.
Commercial trucks are “bespoke vehicles,” she said. “So, these are unique, and that’s where the value is. And when they go through auction, nobody has any of that data. … So, we have an ability for dealers to do dealer trade or wholesale with each other. … Why should you have to wait until the day of auction to start cycling things out?”
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