Used Commercial Vehicle Sales and Registrations Hit All Time Highs in 2010

by TJ on February 23, 2011

Used truck and used semi trailer sales broke all time records in 2010, with more used commercial vehicle registrations than ever before.  Another first was that used commercial vehicle registrations broke through the 600,000 unit threshold, with over 672,000 trailers and rigs sold in 2010. Overall, used commercial equipment sales comprised 65% of the market (new truck sales accounting for 35% of the market).

This is not just about 2010 beating 2009 – the results demonstrate that the trucking industry ramped up for business in 2011.  Already, operators and carriers are experiencing extremely high demand for their services from shippers who would normally be enjoying a downtime period for the industry.  The winter months tend to be slow for truckers across the country, as consumers and retailers take stock of the heavy spending run up to the Christmas Holidays.

2011 is turning out very differently with retailers reporting excellent consumer sales results, which in turn is fueling business growth in every other sector of the economy.  The bottom line is that shipping clients are finding freight prices are rising in response to the excess demand, and the Shipping Conditions Index (SCI – maintained by FTR Research) has gone negative for the first time in a long time, and for this to happen in a February is practically unheard of.  The SCI demonstrates the state of the freight and logistics market from a shipper’s perspective.  If the index is positive, it means there is capacity to shift cargoes within the trucking industry, and that also means they can better negotiate pricing.  A negative index means there is not enough freight capacity to go around, which serves to create localized and generalized demand forcing prices higher.

In response to the excess shipping demand, operators from the smallest to the national carriers have been taking on new equipment to service business.  The restraining factor does not appear to be the availability of equipment, however; instead it is that there is an acute shortage of CDL qualified drivers.  In 2011, 200,000 new drivers are needed with a similar number in 2012 however these estimates, made in 2010, are looking increasingly shaky and on the low side.

2011 is set to be the year when the recovery really makes itself felt throughout the economy, however for the trucking industry business has been booming.  As one of the early industry indicators for the rest of the economy, demand for freight services is a good indicator for how the forward economy is going to perform in the short term. We can expect to see sales of used semi trailers and tractor units continue to rise this year, with the bulk of market supply coming from the fleet disposals of the larger carriers who deferred replacing equipment in 2010 in order to maintain cost control.

The outlook for the used truck market and the trucking industry generally is extremely positive for 2011.

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