Dive Brief:
- Used truck sales were unusually high in August, increasing 14% month over month, likely driven by lower prices, ACT Research reported Thursday.
- Prices for Class 8 trucks dropped during that time by as much as 20% on average for model year 2019 units and nearly 1% for model year 2021 units, J.D. Power also reported this month.
- Conditions are shifting toward a more normal used truck market as shipper inventories fall and trucking capacity rebalances, Steve Tam, vice president at ACT Research, said in a monthly report.
Dive Insight:
Along with retailer destocking and sluggish demand lowering trucking prices, Yellow Corp.’s Chapter 11 bankruptcy means an influx in used trucks will add further pressure to the market, Ryder System CEO Robert Sanchez noted last week.
“The Yellow impact has not been felt yet,” Sanchez said at the Morgan Stanley 11th Annual Laguna Conference on Wednesday. “We’re expecting the used truck market to continue to decline through the balance of the year.”
The shuttered LTL provider listed 11,700 owned trucks as well as 34,800 trailers in its annual filing this year. That rolling stock is slated to be sold separately from Yellow’s real estate.
Estes Express Lines and Old Dominion Freight Line are in a billion-dollar bidding war for Yellow’s expansive terminal network. Estes reemerged as the stalking horse bidder with a $1.525 billion offer last week.
The LTL firms aren’t the only businesses interested in Yellow’s assets. Over 500 prospective buyers have been in contact with an investment banker, Ducera Partners, and Yellow as outside parties consider purchasing terminals, trucks and trailers, according to a bankruptcy document filed Wednesday.
