Falling used truck prices push largest dealership network to sidelines

Falling prices for used trucks might be good news for those in the market for older iron. But they are having an opposite effect on Rush Enterprises, the nation’s largest new and used truck dealership network.

“Looking ahead, we expect used truck values to continue to decline, and we plan to maintain our low inventory levels until conditions begin to normalize,” Rush Enterprises CEO Willam “Rusty” Rush said Thursday on the company’s earnings’ conference call.

Rush had strong financial results in the quarter — no thanks to used trucks, which fell to 7,019 units in 2022, down 6.7% year over year.

Supply shortage drove used truck prices to the stratosphere

Short supplies of used trucks in 2021 and much of 2022 drove retail and auction prices to stratospheric levels. Some trucks sold for as much as 150% above pre-pandemic levels.

“In the second and third quarters, demand and values declined significantly as more new trucks became available,” Rush said. “In the third quarter, we took swift action to minimize our used truck inventory to historically low levels. In the fourth quarter, low freight rates continued to cause weak demand and used truck values declined further.”

ACT Research reported this week that the preliminary average retail prices of a used Class 8 truck sold in January dropped 5% compared to December to just over $75,600. That was 14% lower than January 2022.

‘Comparisons … increasingly negative’

“Comparisons are expected to become increasingly negative,” Steve Tam, an ACT vice president, said in a news release.

Compared to December 2022, the average truck sold at retail had 9% more miles with a 2% decline in equipment age. Year over year, the trucks had 4% more miles and the age was flat.

A surge in end-of-year deliveries on new trucks directly impacted the used market.

“January used retail sales were even able to eke out a gain relative to January 2022,” Tam said, “though, we view January’s performance as a bit of an outlier and still expect sales to be lower in 2023.”

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Why the used truck pricing bubble finally burst

‘Once-in-a-lifetime-pricing-boom’ in used trucks reverses course

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