Used truck auction prices drop as more truckers abandon their vehicles and leave the industry

Gian

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Used truck auction prices drop as more truckers abandon their vehicles and leave the industry
@Panzerhund @TimeBandit @Auslander-Raus!
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Auction prices for used trucks are falling as the freight market cools off. The rate at which prices are falling is occurring almost as rapidly as they rose to record-highs over the last year.

The drop in used truck prices is leaving many owner-operators stuck with overpriced equipment that they purchased when prices were very high. Many made purchases in the belief that prices would keep increasing and that they could get back what they spent and possibly more.

Chris Visser, a senior analyst and the commercial vehicles product manager for industry analysis company J.D. Power Valuation Services, also noted that prices are decreasing as more independent truckers leave the industry and sell off their old trucks. (Related: Soaring diesel prices are hammering the trucking industry, leading to more inflation on nearly everything.)

The market is primarily absorbing trucks from fleets no longer retaining all of their older iron as new trucks trickle in and, to an extent, from owner-operators leaving the industry or going to work for a fleet,” said Visser.

β€œTrucking economy data show rising terminations of owner-operator authorities and a steady and notable decline in spot rates from February through May,” said Visser. β€œTaken alone, those two items could suggest that new owner-operators who entered the industry in 2020 and 2021 are now exiting the industry.”

In J.D. Power’s latest Guidelines report, the company said auction prices in May for used trucks made in the 2020 model year fell by 11 percent compared to April. Prices for model 2019 trucks fell by nearly 16 percent month-over-month and 2018 model prices dropped nearly 10 percent.

β€œIn May, three- to five-year-old trucks averaged 12 percent less money than April, but 57.5 percent more money than May 2021,” said Visser, noting how prices are still relatively high compared to before 2020. β€œYear-over-year, late-model trucks sold in the first five months of 2022 averaged 82.6 percent more money than the same period of 2021.”

Steve Tam, vice president of the market analysis company ACT Research, also noted that retail prices in dealerships are still near or at record highs. Pricing moves in dealerships usually fall after auction prices drop. But as rates fall, so will demand for new and used trucks.

β€œUnfortunately, long-awaited reports of loosening inventories come at exactly the wrong time in the cycle,” said Tam. β€œThis is the beginning of the end of the cycle, which promises to be every bit as exciting on the way down as it was on the way up.”

More truckers likely to sell their vehicles as skyrocketing diesel prices make work unprofitable
Many truckers are warning that skyrocketing diesel prices could have long-term consequences for American supply chains.

Austin Smith, the owner of Texas-based trucking company Iron River Express, said it costs him over $20,000 a week to keep his three trucks running.

β€œIf something drastic doesn’t change in the next few weeks/months, I promise you, you’ll see empty shelves everywhere you look,” wrote Smith in a Facebook post that has been shared over 290,000 times. β€œYou’ll see chaos as people fight for the basic necessities of everyday life.”

Diesel prices have risen by over 76 percent in the past year. The national average price of diesel is currently at a record $5.812 per gallon and is still rising. This means that truckers are spending more and more to keep their trucks on the road each day.

Richard Resek, a trucker that runs routes out of the ports in New York and New Jersey, told Business Insider that he has to spend as much as $1,700 each day just to refuel his truck. He is also resorting to turning off his air conditioning and rolling down his window during long summer nights and plotting out routes to drive by gas stations with cheaper fuel prices.

Nick, a trucker from Maryland who owns a small carrier company, said he has had to take loads at a loss.

β€œI have the option not to run my fleet at all, but I care more about keeping my drivers busy,” he said. β€œDrivers are the most important asset and sometimes that means I have to accept loads that are not in my favor.”

Other truckers are unable to keep operating at a loss and are instead closing shop. Shauntai Robinson, the owner of Mid-Carolina Transportation, said the elevated fuel prices will likely push new business owners out of the industry after a record number of new trucking companies opened in 2021.

β€œThe industry is overrun with new carriers that don’t know how to quote a rate,” said Robinson. β€œThey’re so focused on competing for a load that their quotes are unrealistic. They won’t be able to sustain that.”
 

bean_ shooter

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Always been a company driver so I don't pay for fuel but I pay attention to what the company pays and out west it's outrageous.
Saw close to $7 for diesel in Oregon yesterday.
Get ready for empty shelves folks because even the big chain stores won't be able to absorb the shipping costs for long.
 

RickGozinya

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Always been a company driver so I don't pay for fuel but I pay attention to what the company pays and out west it's outrageous.
Saw close to $7 for diesel in Oregon yesterday.
Get ready for empty shelves folks because even the big chain stores won't be able to absorb the shipping costs for long.
If you don't mind me asking, how much do you bring home on an average year? I don't personally know anyone who drives truck but was always curious about how good of a living it is.

Before the madness started, I was telling my son to get a CDL A licence just in case life plans don't work out. I always see "now hiring drivers" signs everywhere
 

bean_ shooter

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If you don't mind me asking, how much do you bring home on an average year? I don't personally know anyone who drives truck but was always curious about how good of a living it is.

Before the madness started, I was telling my son to get a CDL A licence just in case life plans don't work out. I always see "now hiring drivers" signs everywhere
Been doing this for over 10 years with a flawless safety record so it makes a big difference in pay compared to a new driver.
Today I average 13 to 1600 a week.
5 day work week with a huge sign on bonus but I agreed to work the left coast that has a massive Driver retention problem because of how bad conditions are.
Your son can do well in this industry but has to put in the time to build a good record of safety.
BUT a young man with no wife and kids can practically live in a truck while saving his money and make a tidy sum for his future endeavors.
 

RickGozinya

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BUT a young man with no wife and kids can practically live in a truck while saving his money and make a tidy sum for his future endeavors.
Exactly what I told him. Go work your ass off for at least 5yrs and rent the pussy if you have toπŸ˜‰. Get a nice fat piggy bank then plan your future.

We tried to explain to our kids that their "inheritance" is like a 401k. We will match what they save up on their own. No freebies
 

Bon

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Saw close to $7 for diesel in Oregon yesterday.
Well over $7.00 in the Bay Area of California. "Regular" gas was $7.49 when I left last Saturday.

I read an article a few months ago that the likes of Amazon is looking to take over the entire trucking industry, industrialize and corporatize it - and pay drivers $15/hour. This may be what's coming.
 

GoodOlboY

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There is only one way forward, and decadent America deserves it.

Lord, may the ensuing chaos grant America First the opportunity to grow and wrest power from the clutches of Satan. Amen.
 

GoodOlboY

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I read an article a few months ago that the likes of Amazon is looking to take over the entire trucking industry, industrialize and corporatize it - and pay drivers $15/hour. This may be what's coming.
That's about as practicle as the WEF instituting a one world government. These ruling elite are lunatics.
 

anti-barabas-ite

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Well over $7.00 in the Bay Area of California. "Regular" gas was $7.49 when I left last Saturday.

I read an article a few months ago that the likes of Amazon is looking to take over the entire trucking industry, industrialize and corporatize it - and pay drivers $15/hour. This may be what's coming.
Walmart and amazon have invested in driverless trucks....its almost here
 

DaveA

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Exactly what I told him. Go work your ass off for at least 5yrs and rent the pussy if you have toπŸ˜‰. Get a nice fat piggy bank then plan your future.
Yeah, live in your truck, convert all your earnings to crypto, and when you've saved up enough, move to a non-ZOG country and start a family there.

Just don't let your gook wife talk you into investing in her family's business. Expats go broke real fast when they start "investing".

ZOG countries still pay relatively high wages, but human reproduction has to happen somewhere else.
 

Benvenuto Cellini

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Yeah, live in your truck, convert all your earnings to crypto, and when you've saved up enough, move to a non-ZOG country and start a family there.

Just don't let your gook wife talk you into investing in her family's business. Expats go broke real fast when they start "investing".

ZOG countries still pay relatively high wages, but human reproduction has to happen somewhere else.

Reproducing with a Gook isn't reproduction.
 

RickGozinya

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Yeah, live in your truck, convert all your earnings to crypto, and when you've saved up enough, move to a non-ZOG country and start a family there.

Just don't let your gook wife talk you into investing in her family's business. Expats go broke real fast when they start "investing".

ZOG countries still pay relatively high wages, but human reproduction has to happen somewhere else.
A buddy of mine has an online Filipino GF that he's actually went to see earlier this year. For as much as the USD sucks, he loved like a king over there for a month.
Smokes we're $3 a pack and fine dining hovered around happy meal prices🀣
 

JR_Rustler_III

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Get ready for empty shelves folks because even the big chain stores won't be able to absorb the shipping costs for long.
We are at Stage One of what is a three stage process.

1. Retailers absorb increased costs to avoid a drop in sales
2. Retailers capitulate and start passing along increased costs to customers
3. Customers drastically cut back on their purchases, sales drop precipitously
4. GOTO 1

This is called "an inflationary spiral", where prices surge, then pause, then surge, then pause, then surge, etc.
 

anti-barabas-ite

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Electrek.co: Einride gets NHTSA approval to operate its autonomous electric trucks on US roads.
 

WOSS

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Haven't we been in a deflationary market since 6/15/22 when the fed raised rates, or is this more of a dead cat bounce?
 
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