Surveying the transportation landscape with industry expert Rob Slavin

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Ritchie Bros. transportation industry expert

Why truck tractor pricing soared in 2021, plus a top-10 trucks sold last year

The transportation industry saw substantial disruption last year due to a confluence of factors – pricing, labor, supply chain issues, and more. Our in-house transportation industry expert Rob Slavin, Senior Valuation Analyst, speaks with us to break down what happened in the sector in 2021, and what we can expect looking forward. We’ll also look at a top-10 of the big-money sellers from last year.

You’ve been in the transportation business for most of your career. From your professional experience, how does 2021 stand out in the transport trucks industry?

Rob:I’ve been in the transportation business for 30 years. I started at a new truck OEM and spent 22 years there working primarily on the used truck side of the business. I worked at one of the largest truck dealership franchises in the U.S. and have spent the last 5 years here at Ritchie Bros. as a Senior Valuation Analyst. While the used truck business is very cyclical, what we have experienced in 2021 is like no year I can remember. Over the last year the transportation industry has experienced record setting increases in transportation equipment pricing – primarily in tractors and dry van trailers.

Q: Was has been the root causes for the kind of pricing elevation you’re seeing in truck tractor sector?

Rob:Before I get into just how much equipment pricing has increased, we need to understand what got us to this point. Now, 2 years into the pandemic, we have seen significant supply chain disruptions that prevented new truck manufactures to build enough equipment to build a strong used truck supply. And it wasn’t just one or two items holding up the process, it was semi-conductors, resin, glass, and steel, just to name a few. If you need a new tractor – get in-line, as most OEMs are sold out for 2022 and taking orders for 2023. We are also seeing strong freight in the market with a shortage on drivers. The limited supply of drivers combined with the high amount of freight have forced spot rates (a short-term transactional freight pricing – based on carrier supply and shipper demand) to highest spot rates that I can remember.

Here’s a quick comparison showing how much spot rates increased. Comparing the first 6 months of 2020 vs. December of 2021, the average increase was $0.99 per mile – a 51% increase (national average), with a high of $1.62 per mile for dry vans on the West Coast (a 91% increase). Add on a 40-year high for inflation and you get the highest pricing we have seen in transportation equipment we have ever seen.

Q: Has the pricing been up across the board or are you seeing upticks with certain models, years, etc.?

Rob:With regards to tractor pricing – we have seen all ages/makes/models jump at high levels. We have seen 2019 models and newer sell for more than brand new units with full warranty and FET (federal excise tax). Some of the highest pricing we’ve seen were a pair 2021 tri-axle sleepers going for $75,000 over what a new model would sell for. We also sold a unused 2022 T680 6x4 sleeper for $260,000 (+$90,000 over new truck pricing). The most frequently sold brand at Ritchie Bros. Auctioneers is a 6-year-old Freightliner Cascadia sleeper. In one year, the price on a 2016 Freightliner increased $32,900 on average, a 129% jump for models with a 400-799K mile range. The biggest jump, however, was a 550-599K mile unit that was selling for an average of $32,600 in late 2020 versus $72,000 in late 2021. That’s a $40,000 increase!

Q: Has it been a similar story for truck trailers?

Rob: As a percentage to sale – 53’ dry van trailer pricing has grown even higher than tractors vs. previous 5-year average sale pricing. Looking at 8- to 15-year-old trailers, for example, we have seen overall an average increase of $15,600, which is a 206% increase. The biggest jump was 11-year-old 53’ dry van trailers, which saw an overall increase of $18,899 over the 5-year average – that’s a 241% increase.

Much like late-model tractors, we have seen late-model trailers bring very high premiums over what new dry van trailers sell for. An example would be 2-year-old 53’ dry vans breaking the $70,000+ mark, including 2022 models that sold for $76,000. We even seen a 2009 53’ dry van sell for $42,000, which is well over $10,000 more than it sold for new 13 years ago.

Q: What’s next for the transportation industry in the coming year. Do you see continued price escalation or a return to ‘normal’?

Rob:What the market has experienced is a perfect example of “supply and demand” dynamics. So, when does the music stop … when to we get back to more “normal” levels? That will be determined in my opinion by the following factors:

First – new truck production/used truck supply. When can the OEMs start to build enough new trucks that will allow for a buildup of used inventory?

Second – freight & spot rates. How long will freight be strong enough to maintain the high level of spot rates we are seeing over the last 1-1.5 years? Talking with new truck OEMs and their dealers, I don’t expect 2022 to look too much different than 2021. Most are expecting supply issues to soften in the second half of 2022. I expect those that were willing to sell excess units, already have sold them. Based on the year we just had, I don’t think anyone really knows what the new “normal” is going to look like.

Graph showing truck pricing soared in the United States in 2021

(Truck pricing data taken from Ritchie Bros.’ Market Trends Summary January edition)

Top 10 big-ticket truck tractors sold in 2021

Every month we help customers all around the world buy and sell thousands of used trucks via our live online auctions. Want to see some of the top sellers from last year? Check out our Top-10 from 2021 sold, and don’t forget you can always contact us to sell your trucks for the best returns possible.

1. 2021 PETERBILT 389 Sleeper Truck Tractor (Tri/A) – $265,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

2. 2019 PETERBILT 389 Day Cab Heavy Haul Truck– $262,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

3. Unused 2022 KENWORTH T680 6x4 (Unused) Truck Tractor (T/A)– $260,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

4. 2020 PETERBILT 389 Day Cab Truck Tractor (Tri/A)– $255,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

5. 2020 PETERBILT 567 Tri/A Day Cab Heavy Haul Truck– CA$245,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

6. 2022 KENWORTH T880 Tri Axle Sleeper Heavy Haul Truck– CA$240,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

7. 2022 KENWORTH W900L Day Cab Truck Tractor (Tri/A)– $240,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

8. 2018 FREIGHTLINER SPORT CHASSIS 4x4 Crew Cab Hauler Truck Truck Tractor (T/A)– $195,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

9. 2020 VOLVO VNL860 Sleeper Truck Tractor (T/A)– $195,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

10.2015 KENWORTH C500 T/A T/A 380 In. WB Bed Truck– CA$410,000

Used trucks and trailers sold by Ritchie Bros. Auctioneers

Thousands of companies sell trucks and transport equipment through our multiple sales channels every year. Learn more about selling with Ritchie Bros., or contact us to discuss your options.

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