Truck prices one year later. First was the rate crash and now the truck price crash is under way.

The worn out Freightliners and Volvos will start going to export like they used to before people here started paying dumb prices for them.

 

I paid $60k for a 500k 2015 Volvo 780 in 2018. The truck is still getting great Blackstone reports at 1 mil. and doing just fine. Total maintenance on it over the 5 years has been about 100k and it's an emissions truck. In this 5 years the truck has made me well over $1 million. I consider myself lucky and if you ask anyone in any business this is an unbelievable return of investment.

The day I can buy a 2019 860 for $60k the day that I WILL buy one, no matter what the market is doing. I hope this is in the next year or two. My plan is to do the same thing again.

I used to want a new truck and trailer. No interest in that anymore. The world is just too volatile. I'm willing to put about the same amount in newer equipment as equals my interest/commitment to the job and since Covid that has gone down a bit.

 

None of this is surprising to anyone with A) business acumen and B) experience.

 

I figured prices would adjust just like anything else when it's a Supply vs. Demand issue.

 

There must be some huge chop shops in 3rd world countries just cutting off tons of emissions junk as each shipment of them comes in

 

Smart money was in the pharmaceuticals, something about a special really needed vaccine.

 

I’d hesitate to call it a vaccine. Vaccines actually work!

 

The amount of new cars sitting in the factory parking lots is crazy. They’ve got them sitting everywhere in rented lots. They keep building more, everyone’s working, no lay offs. Instead they’re hiring. Once the chips come in, there’s going to be an over abundance of new cars and Trucks at the Dealers. They must know something. Since just in time became the norm in the 80’s, only enough for market have been built. Before that, extra were built, not knowing how many would sell. The extra got sold off at discounts, and workers were laid off all summer. When money gets tight, first thing people do is postpone major purchases, especially a house or car, that starts the ball rolling. Sales on everything else, appliances, furniture, everything that goes along with it. Then there’s major layoffs, and all the businesses the workers supported like restaurants follow. None of it is good for Trucking. I think we’re seeing the beginning. Truckings always first to go down and first to come back. I think there’s going to be a wave of repos very soon. About the time the Truck needs new tires. 250-400k miles. 2-3 yr old Trucks. Auctioned for 30-40% of the price for a new Truck, even with a new Truck backlog. That’s about to end soon too. Used market will help, along with a worsening economy. Those new Trucks aren’t worth the asking price. Especially once the used market drops. The depreciation won’t justify the high prices. They’ll come down too.

 

I mentioned this in another thread but I was looking to buy a new O/O specd 579 Peterbilt and was going to trade in my 2022 389 Peterbilt. My 389 is your typical O/O specd (only "down" side is it has a 525 Cummins) and it's sitting at 105,000 miles. They offered me $150,000 trade in for it. The 579 was $206,000. I laughed and said no thanks. If I was really motivated to buy a 579 I'd go sell my 389 on my own and I'm pretty confident I could sell it for $175,000 knowing that truck today would cost you $225,000 to build today.

These dealers lots are beginning to fill-up with new trucks. Fitzgerald just had a handful hit their lot and the same with Rush. Just because these dealers took an order back in October doesn't mean that customer still wants their truck and/or can get financing. It's just a matter of time new truck prices follow the downward trend like the used ones.