NADA Commercial Truck Guide Industry Update

Transcription

1 NADA Commercial Truck Guide Industry Update March 2014 Average retail sleeper pricing sets another record Severe weather likely behind unusual results in many segments Special Study: Effect of Emissions Mandates on the Used Truck Market

2 TABLE OF CONTENTS Commercial Truck Market Trends... 2 Economic Data ATD/NADA Official Commercial Truck Guide Value Trends At NADA Used Car Guide COMMERCIAL TRUCK MARKET TRENDS Summary Increased numbers of newer trucks continue to enter the retail and wholesale channels, providing buyers with better access to the low-mileage iron they demand. Severe weather likely kept many buyers away from the auctions in January, resulting in anomalous results in medium duty and sleeper segments. Used truck pricing could be impacted by upcoming rounds of fuel economy mandates, as a special study explores. Continued volatility in sales volume is expected to subside in the second quarter as winter draws to a close. Sleeper Tractors Retail January s universal average set yet another record, coming in at $56,488. This is the highest figure we ve recorded since our current data analysis processes were introduced in mid Low mileage was a factor - at 520,764 - but this figure was less than 1% lower than other recent low months. Age was identical to December, at 77 months. Month-over-month, January was $2292 (or 4.1%) higher on price and 7284 (or 1.4%) lower on mileage. Year-over-year, January 2014 was $7770 (or 13.8%) higher than January 2013 on price, and 21,840 (or 4.0%) lower on mileage. See the Average Retail Price and Mileage graph for detail. NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 2

3 [ COMMERCIAL TRUCK MARKET TRENDS continued ] The bulk of the retail sleeper market is represented by model years s remain popular as the last of the pre-dpf trucks, and units with attractive mileage will continue to hold their value for as long as they remain available. The first of the DPF trucks s have depreciated the most of recent model years, but even their roughly $415 or 1%/month depreciation is low by historical standards s have seen essentially no depreciation over the past year s the first trucks to feature SCR - hit a low point in May of 2013, then started to appreciate, and are currently selling for the same prices they were last summer s are the major factor in the retail market at present, outselling other model years for the second month in a row. With average mileage for 2011 s just below 400,000, demand remains strong, and supply is still inadequate despite the increased volume. As for the newest trucks, 2012 s continue to enter the market in greater numbers, and are selling for more than their 2011 counterparts did this time last year s are still too rare to be a notable factor at present. See Average Retail Price by Model Year graph for detail. We see little change in these trends over the next two quarters s could place very mild downward pricing pressure on late-model trucks as they enter the market in greater numbers, but it is also possible demand will remain strong enough to absorb this supply with no impact to pricing. The bottom line is dealers can be confident in the value of their late-model inventory in the upcoming months. Average Retail Price by Model Year - All Sleeper Tractors Under 1M Miles Adjusted for Mileage $100,000 $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Source: ATD/NADA Sleeper Tractors Wholesale Auctions appear to have been impacted by January s severe weather, with buyers snapping up mainly the most desirable iron and leaving the rest in the cold. Trucks sold through wholesale channels in January were much younger and lower-mileage than in earlier months. Specifically, the average sleeper tractor sold in January was 72 months old, had 623,844 miles, and brought $38,549. This average truck was a notable 11 months younger than NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 3

4 [ COMMERCIAL TRUCK MARKET TRENDS continued ] its December counterpart, and a whopping 28 months younger than January In terms of mileage, January s average was 19,781 (or 3.1%) lower than December, and a substantial 91,502 (or 12.8%) lower than January This much newer and lower-mileage mix caused January s pricing to come in $7771 (or 20.2%) higher than December s, and $14,751 (or 38.3%) higher than January See Average Wholesale Price and Mileage graph for detail. January was the first month since February 2012 in which less than half of trucks sold had over 600,000 miles. The wholesale market typically has an appetite for trucks with up to around 700,000 miles, but January was an exception. The main factor behind this shift was an unusually high proportion of trucks with ,000 miles, largely of the 2011 model year (see Average Wholesale Price and Number of Trucks Sold graph for detail). Along with this low mileage was the aforementioned average age, which was actually 5 months younger than trucks sold retail an inversion the market hasn t seen since February See the Average Age (Months) of Sleeper Tractors Sold graph for detail. Average Wholesale Price and Mileage: All Sleeper Tractors Under 1M Miles $45,000 $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 Source: NADA and AuctionNet 2 per. Mov. Avg. (Price) 2 per. Mov. Avg. (Mileage) Average Wholesale Price and Number of Trucks Sold by Mileage Range Sleeper Tractors, YTD2014 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Sources: ATD/NADA and AuctionNet Average Age (Months) of Sleeper Tractors Sold Wholesale vs. Retail Price Count We view the auction channel as a good indicator of 100 what dealers forecast the retail channel demanding in upcoming months. To this end, January s results while extreme reinforced the trend towards decreased marketplace tolerance for trucks with over ,000 miles. At the same time, once severe winter weather subsides, we expect averages to return closer to the recent trend Sources: ATD/NADA and AuctionNet Retail Wholesale NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 4

5 [ COMMERCIAL TRUCK MARKET TRENDS continued ] Model vs. Model Competitive Comparison The January time period is traditionally when we switch to the next-newer model year to represent four-year-old trucks. As such, we now consider model -year 2011 trucks four years old. The big story, then, is how much more money four-year-old trucks are bringing now than they did at this time in 2013 and 2012 (as well as earlier years not included in the graph). A very favorable supply/demand relationship for low-mileage trucks is the primary factor at work here. See the Average Retail Price by Model Year graph for detail. In terms of competitive positioning, there was essentially no change all models brought solid pricing in January. The T2000 will no longer be included in future updates because the 2010 model year should have been the last for that model. We say should have been because Kenworth did not build any SCR-equipped T2000 s, but we nonetheless received a small number of T2000 sales labeled as 2011 s. As these sales did not include VINs with which to verify model year, we believe they were actually 2010 s. Next month, we will include the T700. Average Retail Selling Price of 4-Year-Old Sleeper Tractors Adjusted for Mileage $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Average Retail Selling Price of 4-Year-Old Sleeper Tractors Adjusted for Mileage $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Source: ATD/NADA Source: ATD/NADA Avg. for all Trucks 2 per. Mov. Avg. (VNL 730/780) 2 per. Mov. Avg. (386) 2 per. Mov. Avg. (Cascadia) 2 per. Mov. Avg. (T660/600) Avg. for all Trucks 2 per. Mov. Avg. (T2000) 2 per. Mov. Avg. (387) 2 per. Mov. Avg. (VNL 630/670) 2 per. Mov. Avg. (ProStar) Medium Duty Class 3-4 Cabovers As mentioned, severe weather likely put a damper on auction activity in January. This factor manifested itself in an unusually low number of Class 3-4 cabovers reported sold. The few that sold had much higher than average mileage, resulting in lower average pricing. We consider this month an outlier, and will refrain from assigning much meaning to its results. Nonetheless, here are the stats for January: Average wholesale price came in at $8450, NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 5

6 [ COMMERCIAL TRUCK MARKET TRENDS continued ] $3092 (or 26.8%) lower than December, and $6767 (or 44.5%) lower than January Mileage, at 160,466, was 46,509 (or 29.0%) higher than December, and 59,641 (or 37.2%) higher than January See associated graph for detail. We expect a return to more typical figures as we exit the 1 st quarter. Medium Duty Class 4 Conventionals Unlike cabovers and heavier GVW conventionals, lighter GVW conventionals sold in normal numbers in January. Class 4 s are more heavily exposed to the consumer/end-user market than their heavier GVW counterparts, so it is possible that the superior performance of this segment indicates stronger demand. Supporting this observation was a nice month-over -month uptick in pricing. Specifically, the average wholesale selling price of a 4-7 year-old Class 4 conventional in January was $15,618 - $2884 (or 18.5%) higher than December, and $114 (or 0.7%) higher than January Average mileage, at 102,391, was 771 (or 0.8%) higher than December, and 10,726 (or 10.5%) higher than January See associated graph for detail. There is still no shortage of supply of trucks with over 100,000 miles in this segment. In addition, end users confident in their job or business outlook are largely Average Wholesale Price and Mileage: 4-7 Year-Old Class 3-4 Cabovers $20,000 $18,000 $16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 2 per. Mov. Avg. (Price) $2,000 Sources: ATD/NADA and AuctionNet 2 per. Mov. Avg. (Mileage) $0 Average Wholesale Price and Mileage: 4-7 Year-Old Class 4 Conventionals $25,000 $20,000 $15,000 $10,000 $5,000 2 per. Mov. Avg. (Class 4 Price) Sources: ATD/NADA and AuctionNet 2 per. Mov. Avg. (Class 4 Mileage) $0 shopping for new trucks. At the same time, used trucks with mileage in the low-6 figures still have plenty of remaining life, and are at an attractive price point. It is likely that future performance of this segment will reflect the slow but steady growth of the economy overall. 180, , , , ,000 80,000 60,000 40,000 20, Medium Duty Class 6 Conventionals Like cabovers, heavier-gvw conventionals saw a steep decline in volume in January. NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 6

7 [ COMMERCIAL TRUCK MARKET TRENDS continued ] Unlike cabovers, trucks that did sell had lower-than-average mileage. This performance is logical, as only the most desirable trucks would be expected to sell in a low-volume month. As with cabovers, we consider January s result an anomaly, so we do not read too much into the results. With this in mind, the average 4-6 year-old Class 6 conventional sold wholesale in January brought $23,473, which is $5602 (or 23.9%) higher than December, and $8591 (36.6%) higher than January Mileage, at 123,022, was 39,015 (or 24.1%) lower than December, and 61,170 (or 33.2%) lower than January See associated graph for detail. Average Wholesale Price and Mileage: 4-7 Year-Old Class 6 Conventionals $25,000 $20,000 $15,000 $10,000 $5,000 2 per. Mov. Avg. (Class 6 Price) Sources: ATD/NADA and AuctionNet 2 per. Mov. Avg. (Class 6 Mileage) $ Again, January s results were not indicative of a shifting market. Previous months suggest mildly higher demand for trucks with mileage in the low to mid 100s, and we will stick with that observation for now. Sales Volume Unusual month-over-month swings in volume of trucks retailed continued in January, heading back down after December s increase. Dealers sold 5.3 trucks per rooftop in January, down 1.0 trucks (or 15.9%) from December, and also down 1.0 trucks from January 2013 (see Average Number of Used Trucks Retailed graph for detail). Two of the major factors likely contributing to volatility in late 2013 political budgetary dysfunction and uncertainty regarding tax benefits are no longer primary factors. However, severe weather is every bit the Average Number of Used Trucks Retailed per Rooftop Source: ATD/NADA 0.0 factor it has been in recent months, and will continue to be into the 2 nd quarter. As such, we expect monthly swings in volume to continue into spring. NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 7

8 [ COMMERCIAL TRUCK MARKET TRENDS continued ] In the wholesale channel, January s volume was moderately better than December s, but still well off the calendar-year 2013 average (see Total Wholesale Sales Reported to NADA graph for detail). As in the retail channel, we place primary blame on the weather, with similar improvements forecast as we exit the 1 st quarter. Total Wholesale Sales Reported to NADA Total: 42, Total: 29, Total: 34, Total: 39,179 Special Study: How will Upcoming Emissions Mandates Impact the Used Truck Market? Sources: ATD/NADA and AuctionNet By now you re well aware of President Obama s announcement that he will direct the EPA and DOT to set the next (post-2018) round of medium and heavy truck fuel economy and emissions standards. The first round of standards was finalized in September 2011, and trucks meeting those standards are just now going into production. This study examines the impact of standards on selling price, and provides a look at how the used truck market could perform post If you regularly read Guidelines or subscribe to our used truck values, you know that used Class 8 pricing is currently at historically-high levels. A major reason for this market dynamic is the high price of new trucks. In 2002, truck buyers learned the phrase, emissions escalator. An emissions escalator is simply a surcharge buyers pay for engines that meet current standards. According to a recent NADA/ATD Report (available free at the cumulative effect of the emissions mandates on the price of a new truck was over $20,000. In other words, a new truck sold in 2012 cost over $20,000 more than it did before the requirements were in place (in real dollars). And pricing has increased further since the report was published. These price increases have pushed many buyers to late-model, low-mileage used trucks as a substitute for new. At roughly $56,000, the average sleeper tractor with mileage in the low-500,000s is about one-third the MSRP of a new truck. Granted, most buyers pay substantially less than MSRP. But even at half the price of new, the difference is compelling. On the supply side, thanks to the Great Recession and the 2007 pre-buy, a historically NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 8

9 [ COMMERCIAL TRUCK MARKET TRENDS continued ] low number of new trucks were built for model years This dynamic resulted in a tight supply of iron entering the secondary market as trade-ins. With buyers looking for late-model trucks to substitute for expensive new iron, pricing for low- to averagemileage trucks surpassed pre-recession levels in mid-2011, and has continued accelerating through the present time. The current average retail price of roughly $56,000 is 14% higher than the pre-recession peak in mid And this average truck now has mileage in the low-500,000s, as opposed to the mid-400,000s of So buyers are paying more for trucks with higher mileage. Marketplace acceptance of new technologies will determine whether these conditions continue. Historically, each new generation of emissions control technology has been met with trepidation. The new truck pre-buy in 2002 advance of the introduction of Exhaust Gas Recirculation (EGR) technology was a major market development, as was the pre-buy of 2006 in advance of the introduction of Diesel Particulate Filters (DPF). On the other hand, pre-buy activity was mild to nonexistent in advance of the most recent Selective Catalytic Reduction (SCR) technology, due mainly to sluggish market conditions, increased comfort level with this technology, and promised fuel mileage improvements. Pre-buys didn t just artificially and temporarily increase demand for new trucks they also increased demand for late-model used trucks to use as a bridge until each new technology had been on the market long enough to work out any bugs. Fortunately, reliability concerns seem to have been largely alleviated with the SCR generation. Also, thanks to much better advance notice of upcoming standards, truckmakers will have more time to develop and test new technologies. These factors, combined with the increased fuel economy of each upcoming step, suggest a pre-buy on the level of 2002 or 2006 is unlikely going forward. On the supply side, thanks to the more typical build rate of model year trucks along with a return to 3-5 year trade cycles - we expect a moderately increased number of late-model trucks entering the secondary market in upcoming years. However, this increased supply should be balanced by the likely ongoing increases in new truck pricing, which will keep many buyers in the used market. For fleets and successful operators who can afford it, a new truck will provide real fuel economy NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 9

10 [ COMMERCIAL TRUCK MARKET TRENDS continued ] benefits. For other buyers, late-model used trucks will remain a popular substitute, helping to absorb any increased supply. Conclusion Expect continued volatility in volume along with anomalous results in pricing for the remainder of the winter, due mainly to extreme weather conditions keeping buyers home. The exception will be for sleeper tractors with under 600,000 miles, which will remain a sure bet regardless of external factors. See the Economic Trends section of this document for more detailed analysis of these factors. Be sure to keep up with our Commercial Vehicle Blog at for realtime updates on market data. NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 10

11 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Prior-Month Change (thousands) Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Unemployment Rate (%) Percent Change from Preceding Period Commercial Truck Guidelines March 2014 [ ECONOMIC TRENDS ] The U.S. government slashed its estimate for 2013 fourth-quarter growth as consumer spending and exports were less robust than initially thought, leaving the economy on a more sustainable path of modest expansion. GDP expanded at a 2.4% annual rate, down sharply from the 3.2% pace reported in January and the 4.1% logged in the third quarter. Americans boosted spending in January despite the harsh winter weather, but activity was much weaker in December than initially reported. The Commerce Department reported that spending rose 0.4% in January following an insignificant 0.1% gain in December, which had initially been reported as a stronger 0.4% increase. Income grew 0.3% in January following no increase at all in December. Consumer spending is closely watched because it drives 70% of economic activity. Job creation ramped up somewhat in February, posting a better-than-expected gain of 175,000, despite expectations that weather would keep the count low. The unemployment rate edged higher to 6.7%, according to the latest report from the Bureau of Labor Statistics. Employment growth had waned over the past two months, and while an improvement, February's number remains below trend of where it had been for the past year, during which monthly job creation has averaged 189,000. The poor employment situation has posed a quandary for the Federal Reserve, which is unwinding its monthly asset purchase program known as quantitative easing but holding to its zero interest rate policy for short-term rates. Though the U.S. Real Gross Domestic Product Percent change from preceding period (%, SAAR) Source: U.S. Bureau of Economic Analysis Quarter Unemployment and Labor Participation Rates Seasonally Adjusted Source: U.S. Bureau of Labor Statistics Participation Rate Monthly Change in Nonfarm Payrolls Seasonally Adjusted Month Unemployment Rate Labor Participation Rate (%) Source: U.S. Bureau of Labor Statistics (Continued on page 12) Month NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 11

12 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Index Level Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Housing Starts (thousands) Commercial Truck Guidelines March 2014 [ ECONOMIC TRENDS continued ] central bank has set a 6.5% target for the jobless number before it will consider raising rates, it likely will have to reconsider and could do so as soon as its March meeting. The declining rate has been a mix of middling job creation and labor force participation that has languished around 35-year lows. At the same time, long-term unemployment remains a major structural impediment, making the Fed's final decision on interest rates likely more reliant on an arbitrary qualitative impression of economic health. The number of people without jobs for 27 weeks or longer grew 203,000 to 3.8 million a group that now represents fully 37% of the unemployed. Biggest job gains in February came from professional and business services, which added 79,000 positions. Temporary help grew by 24,000 while wholesale trade gained 15,000 jobs and bars and restaurants contributed 21,000 and construction also added 15,000. Retail lost 4,000 jobs for the month while government employment was little changed. However, electronics and appliances lost 12,000, the first sign of the impact of mass retail store closures across the country. Total Housing Starts, Privately Owned Seasonally Adjusted Existing-home sales, which are completed transactions, fell in January to the lowest level in 18 months, but ongoing inventory shortages continue to lift prices in much of the United States, according to the National Association of Realtors. Total existinghome sales dropped 5.1% to a seasonally adjusted annual rate of 4.62 million in January from 4.87 million in December; sales are also 5.1% below the 4.87 million-unit pace in January Last month s level of activity was the slowest since July 2012, when it stood at 4.59 million. The median existing-home price for all housing types in January was $188,900, up 10.7% from January Distressed homes foreclosures and short sales accounted for 15% of January sales, compared with 14% in December and 24% in January Source: U.S. Census Bureau (Continued on page 13) Month S&P/Case-Shiller 20-City Composite Home Price Index Three-month moving average published with a two-month lag. Source: S&P Dow Jones Month NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 12

13 Average Price Average Price Commercial Truck Guidelines March 2014 [ ECONOMIC TRENDS continued ] Total housing inventory at the end of January rose 2.2% to 1.90 million existing homes available for sale, which represents a 4.9-month supply at the current sales pace, up from 4.6 months in December. Unsold inventory is 7.3% above a year ago, when there was a 4.4-month supply. A supply of 6 to 6.5 months represents a rough balance between buyers and sellers. According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixedrate mortgage slipped to 4.43% in January from 4.46% in December; the rate was 3.41 % in January U.S. crude oil refinery inputs averaged over 15.2 million barrels per day during the week ending Feb. 28, 2014, 87 thousand barrels per day less than the previous week s average. Refineries operated at 87.4% of their capacity last week. Gasoline production increased last week, averaging over 9 million barrels per day. Distillate fuel production decreased last week, averaging 4.6 million barrels per day. Regular Grade Gasoline Prices (all formulations) $4.00 $3.90 $3.80 $3.70 $3.60 $3.50 $3.40 $3.30 $3.20 $3.10 Source: U.S. Energy Information Administration Average Price Per Gallon On-Highway Diesel Fuel Prices $4.15 $4.10 $4.05 Month Average Price Per Gallon $ YoY Change $ YoY Change $0.40 $0.30 $0.20 $0.10 $0.00 ($0.10) ($0.20) ($0.30) ($0.40) ($0.50) $0.20 $0.15 $0.10 Price Change Gross exports of petroleum products from the United States reached 4.3 million barrels per day (bbl/d) in December 2013, the first time exports exceeded 4 million bbl/d in a single month. December exports cap a year of steady growth and bring average exports for full-year 2013 to 3.5 million bbl/d, 350,000 bbl/d (11%) higher than in The increase in exports was broad-based, affecting multiple products. $4.00 $3.95 $3.90 $3.85 $3.80 $3.75 $3.70 Source: U.S. Energy Information Administration Month $0.05 $0.00 ($0.05) ($0.10) ($0.15) ($0.20) ($0.25) Price Change The U.S. average retail price of regular gasoline increased 4 cents to $3.48 per gallon as of March 3, 2014, 28 cents lower than last year at this time. The national average diesel fuel price was down less than a penny to remain at $4.02 per gallon, 11 cents lower than last year at this time. Considering the slower pace in the start of the year, a modest slowdown in the first NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 13

14 [ ECONOMIC TRENDS continued ] quarter of 2014 is likely in any case, with growth accelerating as the year unwinds. What s more, there s a decent chance of an upside surprise. Consumer spending and confidence is still way below what would be considered normal levels by the standards of past economic expansions. As job growth returns and consumers feel more secure, a virtuous cycle of spending begetting more consumer income begetting more spending could be initiated. If this occurs, quarterly growth is likely to exceed an annualized pace of 3%. If that doesn t pan out in 2014, it is very likely to happen before the end of NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 14

15 [ ATD/NADA OFFICIAL COMMERCIAL TRUCK GUIDE TRENDS ] Monthly Change in ATD/NADA Commercial Truck Guide Value February 2014 v. March 2014 NADA Segment 2008MY 2009MY 2010MY 2011MY 2012MY* Commercial Van 0.0% 0.0% -6.3% -7.5% -6.0% Extended Hood -1.5% -3.7% -9.0% -6.8% -7.1% Highway Aerodynamic -3.1% -2.9% -9.9% -8.3% -7.0% Highway Traditional -3.3% -2.8% -8.8% -7.7% -6.8% Local/Delivery Daycab -3.8% -3.2% -9.3% -7.5% -7.0% Medium Duty Cabover 0.0% 0.0% 0.0% -5.5% -4.5% Medium Duty Conventional 0.0% 0.0% -1.1% -4.9% -4.4% Vocational/Construction -3.6% -3.4% -2.8% -2.4% -2.3% *Value movement can be influenced by newly valued vehicles. Annual Change in ATD/NADA Commercial Truck Guide Value February, 2013 v NADA Segment 5YR 4YR 3YR 2YR YTD Change in ATD/NADA Commercial Truck Guide Value NADA Segment 2007MY 2008MY 2009MY 2010MY 2011MY* YoY Segment Change Commercial Van -12.0% 1.7% -18.3% -9.9% -9.9% Extended Hood -3.0% -0.3% 2.3% -6.3% -5.1% Highway Aerodynamic -2.0% -8.9% -6.0% -2.7% -5.2% Highway Traditional -3.1% -0.6% 1.0% -3.3% 0.6% Local/Delivery Daycab -6.4% -6.1% 1.5% -5.9% -6.2% Medium Duty Cabover -22.0% 8.8% -6.7% N/A -7.0% Medium Duty Conventional -14.7% -12.1% -17.4% -15.7% -14.9% Vocational/Construction 0.7% 16.4% N/A N/A 22.3% *Calculations are based on vehicle age, i.e. values for 1 year old vehicles in CY2014 are compared against values for 1 year old vehicles in CY2013. YTD Segment Change Commercial Van 0.0% 0.0% -6.4% -7.6% -6.2% -4.7% Extended Hood -1.5% -3.7% -9.0% -6.8% -7.1% -5.7% Highway Aerodynamic -3.0% -2.7% -9.7% -7.5% -6.4% -5.8% Highway Traditional -3.3% -2.8% -8.8% -7.7% -6.8% -5.9% Local/Delivery Daycab -5.8% -5.4% -9.3% -7.3% -6.5% -6.7% Medium Duty Cabover -4.7% -5.0% -4.2% -12.5% -7.3% -5.0% Medium Duty Conventional -0.2% 0.0% -0.9% -9.4% -6.9% -2.9% Vocational/Construction -3.6% -3.4% -2.8% -2.4% -2.3% -3.0% NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 15

16 AT NADA USED CAR GUIDE What s New NADA Online delivers values from 10 different NADA guidebooks including commercial trucks. Starting at $385 per year, NADA Online is comprehensive, easy to use and includes mobile web access free with your subscription. And since it s web-based, there is no software to install and your whole staff can use it at the same time without the need for additional user licenses. NADA Online provides NADA Retail, Loan and Wholesale values for truck and trailers dating back to the 2000 model year. If you re looking for a small number of commercial vehicle values, the Official Commercial Truck Guide Online Mini-Pack provides three values online for $40. On the Road Senior Analyst and Product Manager Chris Visser will be attending and speaking at Bear Marketing Group s Advanced Used Truck Appraisal workshop in Nashville, Tennessee from April 22 23, During the interactive training course, Chris will provide used vehicle market data and appraisal tips. Stay up to date with the latest in the commercial truck industry by stopping by NADA s Commercial Truck Blog and our Market Overviews video section of the website. Updated twice per week by Chris, the blog provides real-time analysis of incoming sales data from the industry s leading used truck sales database. NADA produces a monthly market overview video to provide further insight into the commercial truck market. About NADA Used Car Guide Since 1933, NADA Used Car Guide has earned its reputation as the leading provider of vehicle valuation products, services and information to businesses throughout the United States and worldwide. NADA s editorial team collects and analyzes over one million combined automotive and truck wholesale and retail transactions per month. Its guidebooks, auction data, analysis and data solutions offer automotive/truck, finance, insurance and government professionals the timely information and reliable solutions they need to make better business decisions. Visit nada.com/b2b to learn more. Senior Analyst and Product Manager Chris Visser x4731 cvisser@nada.org Automotive Dealers, Auctions, Insurance Dan Ruddy x4707 druddy@nada.org Credit Unions, Fleet, Lease, Rental Industry, Government Doug Ott x4710 dott@nada.org Business Development Manager Jim Gibson x7136 jgibson@nada.org Financial Industry, Accounting, Legal, OEM Captive Steve Stafford x7275 sstafford@nada.org PR Manager Allyson Toolan x7165 atoolan@nada.org NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 16

17 NADA CONSULTING SERVICES NADA s market intelligence team leverages a database of nearly 200 million transactions and more than 100 economic and market-related series to describe the factors driving current trends to help industry stakeholders make more informed decisions. Analyzing data at both wholesale and retail levels, the team continuously provides content that is both useful and usable to dealers, financial institutions, businesses and consumers. Complemented by NADA s analytics team, which maintains and advances NADA s internal forecasting models and develops customized forecasting solutions for clients, the market intelligence team is responsible for publishing white papers, special reports and the Commercial Vehicle Blog. Throughout every piece of content, the team strives to go beyond what is happening in the industry to confidently answer why it is happening and how it will impact the market in the future. Senior Director, Vehicle Analysis & Analytics Jonathan Banks x4709 jbanks@nada.org Senior Analyst and Product Manager Chris Visser x4731 cvisser@nada.org ADDITIONAL RESOURCES Guidelines Updated monthly with a robust data set from various industry sources and NADA s own proprietary analytical tool, Guidelines provides the insight needed to make decisions in today s market. White Papers NADA s white papers and special reports aim to inform industry stakeholders on current and expected used vehicle price movement to better maximize today s opportunities and manage tomorrow s risk. NADA Perspective Leveraging data from various industry sources and NADA s analysts, NADA Perspective takes a deep dive into a range of industry trends to determine why they are happening and what to expect in the future. Commercial Vehicle Blog Written and managed by Senior Analyst Chris Visser, the Commercial Vehicle Blog analyzes market data, lends insight into industry trends and highlights relevant events. Connect with NADA Read our Blog nada.com/commercialtruck Follow Us on Find Us on Facebook Facebook.com/NADAUsedCarGuide Watch Us on YouTube Youtube.com/NADAUsedCarGuide Disclaimer: NADA Used Car Guide makes no representations about future performance or results based on the data and the contents available in this report ( Guidelines ). Guidelines is provided for informational purposes only and is provided AS IS without warranty or guarantee of any kind. By accessing Guidelines via or the NADA website, you agree not to reprint, reproduce, or distribute Guidelines without the express written permission of NADA Used Car Guide. NADA Used Car Guide 8400 Westpark Drive McLean, VA nada.com/b2b 17