This graph depicts the depreciation curve of the average Model Year truck from the current resale market and where it will stand to resell in 2019. These are the most popular model years for their respective models.
Key Takeaways for Decision Makers
BUYERS: If you are looking to buy a used heavy duty Kenworth truck, take into consideration that there are currently a large amount of T800’s on the market resulting in lower prices for a newer model year.
SELLERS: Given the amount of both T800 and W900 models on the market, in order to get a good price for your truck now is not the time to sell. It would be wise to consider waiting for the market to shift especially if it is an older model year truck as the depreciation rate will not be significantly high.
The American Truck Dealers recently named Kenworth’s T880 vocational truck as the 2015 Truck of the Year. If you are not in the market for a brand new T880 but instead looking to buy a different used Kenworth, here is some critical information about the market that you should take into account before making a decision on what to buy.
Focusing specifically on the heavy duty non-sleeper Kenworth trucks, there was an increase in age variability throughout the 2014 calendar year for the highest volume models on the used truck market. In comparison of the average heavy duty Kenworth truck age, a few models showed no change throughout the year whereas others increased or decreased. The average age of a Kenworth model in 2014 was between 6 and 7 years while the T270 started the year averaging just below 4 years of age, but ended at only 1 year in age. It is quite evident the oldest trucks on the market include: T600, T800B, and W900 in the fourth quarter. The average age of the T600 remained high throughout the entire 2014 calendar year. This will have an impact on both average mileage seen on each of these trucks and pricing. The average age of each truck model on the market is going to play a significant role in how many miles are on these trucks. The assumption would be that the older the vehicle, the more miles the truck will obtain. During Q4, the mileage on the majority of the Kenworth models was rising at a higher rate than the age from Q3. Age does not appear to be playing as large of a role in the number of miles these trucks are holding as one may think.
Both age and mileage factor into the prices on the market. The demand for these types of trucks as well as the number of each model on the market will also play a key role. The highest averaged priced model outside of the new T880’s entering the market, is the T700 in Q1 and the T370 during Q4. Despite the fact that the T800 does not have the highest age or mileage, it has the second lowest average resale price. This is heavily driven by the fact that they were flooding the market during 2014. The T800 holds 85% of the heavy duty Kenworth models listed in this past year. However, the T800 also had some of the lowest price fluctuation between quarters in comparison to the other models. If you plan to buy one of these popular used Kenworth’s, the value of the truck if and when you plan to sell is also going to be important.
Given EquipmentWatch depreciation factors, residual values for the average truck for each model was calculated. Given the average model year for each of the 10 models found on the market in 2014, the 2014 model year T880 will have the largest drop in value by 2019. This is due to the fact that it is brand new and the first 3-5 years have the highest depreciation rate for this type of truck. Also, despite the 2010 T660 being higher priced in 2015, the 2004 T800B will be priced quite closely by 2019. The 2011 will also depreciate at a much higher rate than either the 2007 W900L or the 2004 T800B. Overall, if you choose to buy a T800 it is the closest used truck model to the T880 and there will be many options to choose from. The newer the truck, the higher the depreciation rate will be if you plan to sell the vehicle in a few years.