Values & Market Data

Kenworth Takes a Hit in Market Share while International Soars

In the past three years, June has been a strong month for used commercial truck sales with price stability and market activity increases.
Values & Market Data

Senior Industry Analyst

In the past three years, June has been a strong month for used commercial truck sales with price stability and market activity increases. Despite volume being down for the market as a whole this year, the most popular subtypes and brands still stayed within this seasonal trending. With volume up, prices remaining stable, and age dropping, it will make for an even more interesting July as volume tends to drop after a strong June.
The pie chart shows the increasingly high International market activity for June of 2016 in comparison to the remaining brands currently available within the resale channel.

Key Takeaways for Decision Makers

BUYER/SELLER: The most popular commercial truck brands showed an increase in market activity, but the overall market took a dip which will greatly impact the amount of available trucks for resale in July.

Data consolidated back through 2013 has shown large volume increases on heavy duty commercial trucks during the month of June compared to May consistently over the years. These include an increase of 89.1% between May-June 2013, 191.9% between May-June 2014, and 75.1% between May-June 2015. The June 2016 results indicate the same trend for the most popular subtypes and manufacturers, which confirmed the seasonality of the heavy duty resale market. The overall market however showed drops in volume indicating that the less popular trucks were scarce during June.

Prices increased 11.6% between May-June 2013, dropped 4.3% between May-June 2014 (highly likely due to the larger than usual increases in April & May), and increased 45.6% between May-June 2015 (due to the heavy influx of class 7 & 8 trucks and the drop in light and medium). In 2016, asking prices dropped 1.8% between May and June for the overall trucking market. The largest drop was on class 1-3 trucks down 7.5% from May.

The most popular subtypes and brands showed a volume increase of 41.4% in June with a 1.5% decrease in pricing. This was quite a small drop in price given the large volume increase, which indicates other factors such as utilization and age. Age within the resale channel showed a 2.8% drop in 2016, yet utilization increased 11.5% over May. The large price increase between May-June 2015 well above current prices coincided with the 11.6% drop in average age between June 2015 and June 2016. Utilization was also up by 13.7% this year compared to last. The average age between May-June 2013 dropped 3.5%, between May-June 2014 age increased 3.9% (coordinating with the only price drop between May & June among the 3 years), and dropped 1.3% between May-June 2015.

Focusing specifically on a few of the most popular brands on the resale trucking market, International increased market share well above their 2015 percentage coming in as the most common brand on the market this June. Kenworth showed the largest year over year market share hit dropping to 5.5% in 2016 after 26.1% in 2015. Peterbilt showed an increase in popularity this year increasing from 4.7% market share in 2015 to 12.4% in 2016. GMC and Chevrolet dipped in 2014 and 2015 after an 11.3% share in 2013, but have begun to grow in popularity again with 6.2% share in June 2016.

Diving a bit deeper into the large changes for Kenworth and International, FMV was down on International trucks in June by 1.3% as one of the larger decreases for the popular brands. Market activity, which was evident in the market share increase, showed a 43.5% increase over May. Average utilization on available trucks was down only 1.3% month over month, but 17.6% from June 2015. Despite these drops in utilization trends, age increased 2.0% over May and 6.6% over June of 2015. Even though Kenworth’s large drop in market share for this year, market activity between May and June of 2016 was up 11.8%, indicating that 2016 has overall been a bit slower for Kenworth in comparison to other popular brands on the resale channel. FMV was only down 0.7% for the month and no change in FLV. Average utilization only increased 0.6% over May, but dropped 22.2% since last June. This was a result of a change in age trends as the average age of used trucks in 2016 is down 34.0% from 2015 going from 5.7 to 3.7 years.

In the past, after increases in market activity during June, July has historically shown drops in market activity well below the prior month. However, even though the most popular brands showed market activity increases, the overall market was down in volume during June. This will more than likely have a large impact on July’s month end results.

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