TORONTO, Ont. - Nothing lasts forever, so if you're purchasing a new truck, you're going to have to think about its resale value down the road. Truck News spoke with experts in the used truck industry...
DOWN THE ROAD: Choosing certain spec's on a new truck can increase your chances of getting more cash in the resale market years later.
TORONTO, Ont. – Nothing lasts forever, so if you’re purchasing a new truck, you’re going to have to think about its resale value down the road. Truck News spoke with experts in the used truck industry to find out what are some of the best spec’s you can put on a new truck to enhance its resale value.
Jim Boutilier, a sales representative with Tatro Equipment, said often many of the spec’s that interest potential buyers are the flashier ones.
“It’s a show-and-tell scenario,” he said.
“The main driving force right now, 60 per cent of our buyers, are Pakistani or East Indian. Their preference leans to, for whatever reason, Detroit big block, 13-speed.”
Spec’s like aluminum wheels also fit into the show-and-tell category, but Boutilier said they’re basically a matter of individual preference.
“For it to have resale value, it has to have appeal and if you have aluminum wheels it has appeal to the second buyer. But it’s nothing more than appeal,” he said.
He also said there’s been a big shift over the past 15 years as far as what spec’s help sell trucks in the used market.
With 28 years in the industry under his belt, Boutilier has seen many crises in the industry.
He said problems like the current fuel crisis tend to be the driving force behind new spec’ing trends.
“Every time there’s a crisis, which seems to be every seven years or so, (there’s a shift in trends),” he said. “You had to raise the bar every seven years because there was a bit of a minor crisis in the transportation industry, whether it was driven by rates or whether it’s driven by fuel or whether it’s driven purely by economics.”
Boutilier also listed cost of fuel, better extended warranties and more knowledgeable drivers as driving many of the current trends.
“The shift has also gone to less payments and more money in your pocket because the cost of fuel is taking the majority of the money,” he said.
Bobby Bates of H.D. Hauln said the five big spec’s for resale right now are big block engines, 13-speed transmission, large internal sleepers, high level interiors and exterior trim packages – but you’ll get a lot of differing opinions throughout the industry.
He said motivation for different spec’s tends to differ with application. Long-haul drivers tend to strive to be the most efficient, whereas drivers who run close tend to want all the amenities.
“They want power, they want multi-speed trains, upper-lower bunks,” Bates said. “They want all high-level everything, They want all the toys. That’s what’s really hot.”
As a predominant O/O market, with O/Os picking up the tab to both purchase and run their vehicles, Bates said buyers should get more practical when purchasing their used trucks.
“I certainly think they should. I had a conversation with a ‘good ol’ boy’, a Canadian guy, this morning and he was more realistic. The guy who came in after him wasn’t. Didn’t even ask anything about fuel,” he said. “I can’t remember the last time someone came in and said, ‘Bob, I want the most fuel-efficient truck you’ve got in your shop.'”
Like Boutilier, Bates said ethnicity tends to play a role in what drivers are buying.
“The average guy walks in here – whether he’s Russian or Polish or Indian – and these guys are buying all the Freightliners up and are starting to buy PACCAR products,” he said.
“Then there’s the good old boys, us Canadian guys, they’re in here with their 2004s to get rid of so they can buy a ’96 or ’97 because they’re more efficient.”
Dennis Sheehan, sales manager, used trucks, at Sheehan’s Truck Centre, said two of the main spec’s that help in the used truck market have to do with going ‘big.’
“The first couple, for sure, would be big power and bigger transmission, like a 13-speed as opposed to a 10-speed,” he said. “Everybody now has to have big power. It’s not necessarily that they need it – they just want it.”
Though Sheehan said the target range for desired horsepower hovers around 450-475 hp, 350-375 hp is probably good enough for most applications.
“That amount of power is enough to pull 80,000 lbs. in the space the truck’s going,” he said. “But it’s very difficult to sell it beyond the second-hand market.”
With transmissions, Sheehan said there’s really no contest between 13-speed and 10-speed anymore.
“Everybody wants 13-speed and it’s really hurting the 10-speed on the resale market,” Sheehan said.
Sheehan said extended warranties can also help a truck’s resale value to an extent.
“It really depends on how much the warranties are,” he said. “If they’re going to be silly and charge $5,000 for warranty then it’s probably not worth it. If it’s reasonable to put the warranty on it then it’s going to help sell it down the road.”
Overall, Sheehan said that the best spec’s to put on a new truck are the ones that you can’t change after the fact and add-ons shouldn’t have much market pull.
“Stuff like wheels you can change very cheaply afterwards,” he said. “For example, if you’ve got steel wheels, you can change them to aluminum relatively cheaply. So stuff like that affect it a little bit, but it’s really the things that you can’t do after the fact.”