Key Takeaways for Decision Makers
RENTER/SELLER: If you want to secure the highest premium on the resale market for your telehandler, considering going with JLG. If you have Gehl or Sky Trak equipment, right now through the next couple months could be the best time to sell equipment, since their values have garnished higher premiums recently.
How important is a brand name in the telehandler market? Thousands of dollars in advertising, marketing, and brand awareness are spent each year by major OEMs in this space, and they’re mostly geared towards the sale of new equipment. On the secondary market, the impact of the manufacturer on the average resale price can be harder to determine. At EquipmentWatch, we have developed a metric, known as the brand premium, to better understand this topic. In this article, our brand premiums are based off of the past 13 months of average asking prices in the resale market for every telehandler within each brand. We average all of the average asking prices for all six brands and use that as the baseline. We are then able to isolate the impact of brand by holding constant all of the other major factors like region and age on over 95,000 lines of telehandler data to create these graphs.
The brand premium is the percentage variance from the overall average asking price of the six brands. We chose these six brands because they had the highest market share among telehandlers. Lull was also one of the top brands, but because they are owned by JLG, we did not want half of the brands to be a part of JLG. Brand premiums are important to understand because they provide insight as to which brands have the highest value. By knowing this, you can maximize your profits from whatever sector you work. As can be seen from the graph, there are some interesting takeaways. Genie has the lowest average brand premium among the six brands, staying around 7.5% less than the average telehandler. JLG has the highest average premium among the six brands (JLG also owns Sky Trak), averaging around 2.5% higher than the market average.
The biggest movers in recent months have been Gehl, Sky Trak, and JCB. Gehl brand premiums have risen from around -4% in December to about 2.6% in April, 2016. Sky Trak has fluctuated a lot over the past 13 months, going from right around even and then down to almost 8% and back up to almost even. JCB telehandlers rose to 5% above the overall average only to drop significantly in January of 2016 to -2.5% below the norm. We can also see on the graph that JLG has fallen below the overall average for the first time in the past 13 months in April, 2016. Caterpillar has remained pretty steady over the past 13 months, staying around the overall average for the most part. We can speculate as to why these rises and falls are occurring and as to why some brands are lower and higher than others. Gehl and Sky Trak brand premiums rose dramatically in the beginning of 2016 due to very high increases in volume and average asking prices. Gehl volume increased 130.6% from December to January while prices increased by 18.2%.
Average age is important to understand because it lets you know which brands are staying on the market the longest. The average age on the resale channel shows a wide range across the six telehandler brands with Genie and Gehl having the lowest average age of around six years. Sky Trak has by far the highest average age, ranging between ten and eleven years. The average age of equipment available on the resale market typically corresponds with the economic life of the asset. There were no large upward or downward trends for any of the six brands over the 13 month period. Sky Trak did have the largest variance, going from about 9.4 to 10.4 years over this period. This could be due to the fact that resale values have been falling and more people are deciding to keep their equipment longer. Average meter reads have also increased by almost 30% over this same time period, which goes in hand-in-hand with the age increase.