Today’s Pickup: Used truck sales strong, but oversupply remains

Good day,

Used-truck sales volumes continued their upward trend in October, but the industry is still facing an oversupply of vehicles, according to ACT Research. Class 8 same dealer used truck sales increased 12% month-over-month and 37% over October 2016, the firm said.

“Compared to the first ten months of last year, the year-to-date volume gap widened to 21%,” said Steve Tam, vice president at ACT Research. “A look at the individual market segments reveals strong growth in the auction and wholesale segments, while the retail market held steady.”

According to ACT, dealers are reporting better-than-expected sales, but concern remains about inventory levels.

“Used vocational trucks, such as dump trucks and heavy haul tractors, continue to bring a good profit,” noted Tam. “These trucks were in short supply before the hurricanes hit, and are now needed for both the additional cleanup work and as replacements for the trucks damaged during the storms.”

Did you know?

Spot rates climbed for reefers last week, hitting a three-year record according to DAT. The rate per mile was $2.43, up 3 cents. Van rates inched up 1 cent to $2.07 and flatbed remained unchanged at $2.29.  

Quotable:

“President (Donald) Trump made it clear from day one that unfair trade practices will not be tolerated under this administration, and today we take one more step in fulfilling that promise.”

– Wilbur Ross, Commerce Secretary, on an investigation into Chinese aluminum sheet practices

In other news:

ATA chairman touts tax reform

At a Capitol Hill event on Tuesday, ATA Chairman Dave Manning highlighted the benefits the Republican tax plans would provide for the trucking industry. (Transport Topics)

Cyber Monday hits record

Consumers were tapping their phones on Monday, as the annual Cyber Monday shopping day saw a record of $6.6 billion in online purchases. (Heavy Duty Trucking)

Trump Administration announces investigation into Chinese aluminum

The Trump Administration, without pressure from industry, has opened an investigation into whether Chinese companies were selling aluminum in the U.S. below cost. (Wall Street Journal)

Cass Freight Index rises in October

October was a strong month for the Cass Freight Index, with the indicator reporting freight shipments were up 2.9% annually and 0.5% over September. (Logistics Management)

Trump frustrated by lack of infrastructure projects

President Donald Trump says he is frustrated by the lack of big infrastructure projects since he took office. (Supply Chain Brain)

Final Thoughts

The Trump administration has announced an investigation into whether Chinese companies are selling aluminum in the U.S. below cost. The probe is unique in that no U.S. company filed a complaint, and it could have major implications for the cost of automobiles and truck equipment, among other industries, that use the lower-cost products to keep costs down.  

Hammer down everyone!

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