Used Medium-Duty Truck Values Declining
After the first month of the year, depreciation rates for medium-duty trucks are up and overall orders for the segment are down, according to Black Book’s Feb. 7 Market Insights Report.
In January, model-year 2006 to 2013 trucks depreciated an average of 1.5%, compared to 1.4% the month before. Model-year 2014 to 2015 models depreciated by 1.2%, compared to 1% the month prior. Reports are also indicating that overall orders for medium-duty trucks have gone down, according to Black Book.
“It will be interesting to see how this impacts the market going forward," according to the report. "Will this help improve depreciation rates down the road as these units become more scarce? The current supply of medium-duty units is pretty steady, which is helping fuel the downward trend.”
Chart courtesy of Black Book.
Along with the issue of steady supply of a segment with tepid demand, the industry is also concerned about the rising cost of fuel prices, according to Black Book. The current average price for diesel is $2.59 per gallon, a 47-cent year-over-year increase and a 10-cent increase compared to the previous month.
Meanwhile, in the car and light truck segments, both cars and trucks posted the lowest levels of depreciation seen all year last week, according to the Market Insights report.
Volume weighted, overall car values decreased by 0.35%, compared to the average depreciation rate of 0.43% seen in the previous four weeks. In the truck segment, overall truck values decreased by 0.20%, compared to the average depreciation rate of 0.42% seen in the previous four weeks.
“Good sales and optimism from auction buyers reported across the country. Both car segments and light truck segments showed good retention in values with depreciation levels lowest in nine months,” said Anil Goyal, senior vice president of automotive valuation and analytics.
The best-performing car segments were the sub-compact and compact cars, which realized 0.05% declines to their average wholesale values, respectively. Premium sporty cars suffered the biggest weekly decline in wholesale value, falling 0.75%.
The best-performing truck segments were the compact crossover/SUVs, compact vans, and minivans. These segments saw average wholesale values drop by 0.06%, 0.06%, and 0.07% respectively. The truck segment to see the highest weekly depreciation rate was the sub-compact crossover, which depreciated by 0.70%.