Month over month pricing changes showed the second lowest prices in the past 15 months relative to the previous month during June 2014 and the highest in January 2015, both on heavy duty trucks with evident drops in average pricing between months for medium as well.
Key Takeaways for Decision Makers
BUYER/SELLER: Prepare for lower prices on heavy duty trucks in June and July followed by low prices on medium duty in July coinciding with a large influx of available trucks.
FINANCE/INSURANCE: When evaluating the residual value of a truck, initial price will be key in making correct calculations. Consider accounting for these price drops during June and July within your calculation.
How will the June truck market fair? Based on the previous 2 years, it can be predicted that volume will be up over May and values will be going down. As orders begin to increase on new 2016 model year trucks, the number of used trucks entering the resale market will increase thus driving prices down.
Price Digests Truck Blue Book has shown heavy duty truck values going down in June. Using 431,945 raw data points from the market that power the Truck Blue Book and focusing specifically on class 4-8 trucks between model years 2004-2014, seasonality becomes key in predicting truck prices in the upcoming months. May volume was low in both 2013 and 2014 compared to other seasons throughout the year. During May of 2015, volume was down 45% from May preparing for the large influx of trucks in June and July. Last year, the trucks between years 2004 and 2014 were down 14% in volume from May with a 78% increase going into June. This resulted in a 6.4% drop in pricing between May and June 2014 on class 7 and 8 trucks. Medium duty trucks showed a slightly slower reaction to the volume change as prices did not drop until July of 2014, down 3.3% from June.
The proportion of monthly volume relative to the calendar year shows low availability in May 2013 and 2014 with a large increase in June and July of both years.