The trucking industry has been experiencing a significant shortage of new truck inventory, leading to a surge in demand for used trucks. This has been caused by various factors, including supply chain constraints, semiconductor chip shortages, and raw material shortages. As a result, many dealerships are struggling to keep up with demand, with some not expected to receive new trucks to sell until 2024.
While some may expect the inventory shortage to ease up in 2023, the experts at Knight Transportation suggest that this is unlikely. They predict that OEMs will continue to be out on allocation, with a limited supply of new trucks available for purchase. This will result in a fight between dealerships, fleets, and end-users over who will get the allocation. Ultimately, it will mean that the industry will build fewer trucks than it would without supply chain constraints.
Despite this, there is some good news. The trucking industry’s down cycle has a chance to be shorter since supply hasn’t increased as much as it normally would during good times. However, end-users may not be able to get as many trucks as they want, and the used truck market will likely remain elevated until new trucks start flowing into the marketplace at a faster pace.
Experts also suggest that large fleets will help support the used equipment market by running their trucks longer since they can’t get new trucks. Once they have slots available to buy new equipment, they’ll likely get newer, younger equipment, which will help support more inventory in the used equipment market.
However, the industry is also facing some curveballs with environmental rules, such as NOx treatment, CO2 reductions, and zero-emissions vehicles, which will significantly impact the industry. It will be challenging to predict what impact these rules will have on the used and new truck markets and who can afford to buy a truck.
In summary, the trucking industry’s inventory shortage is likely to persist for the foreseeable future, with new trucks in limited supply. While the used truck market may provide some relief, the industry will face significant challenges with upcoming environmental regulations.