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CAP asks the used truck question...whan it worth?
Page 76
Page 77
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Want to know what the market's doing? How much your trucks will be
worth? John Watts of CAP gives us a regular insight into market trends.
CAP Commercial Vehicle Monitor provides guidance on predicted future values based on vehicle age and mileage for most models and body types currently available. To start our regular series on the sectors within the heavy goods vehicles marketplace, we have chosen 4x2 tractors over 400hp with high-roof sleeper cabs.
Historically,4x2 tractors have been the mainstay of road haulage in the UK, typically with 320-350hp and low-roof sleepers. However, since the introduction of 40/41-tonne and then 44-tonne maximum weights, truck operators switched to 3-axle tractors over a very short period of time — especially those with the higher output engines required to maintain journey times.
Consequently, over the past few years the staple diet of CAP road haulage has become three axle units with a minimum of 420hp. So far this year, two-axle versions account for less than 30% of all tractor registrations. Another factor affecting vehicle specification is the current driver shortage, which is well documented and likely to worsen.Truck operators are now specifying high-roof sleepers in a bid to encourage new drivers — and hang onto their current ones.We also have the prospect of the Working Time Directive, which will have its own impact on staffing problems.
As a consequence, we have significantly reduced our residual value predictions for two-axle tractors over the past three years, but our treatment of high hp/big cab versions is slightly less pessimistic because these models will retain some desirability, especially for operators involved in international transport. This is because maximum chassis space is required to fit the very large diesel tanks considered necessary due to the excessively high fuel prices in the UK.
Dropping values
This chart shows how we have reduced values by an average of 22% for these models, in line with their predicted decreasing popularity.
There was a brief respite from the steady decline in values in early 2002, when we felt the recently-announced reductions in Vehicle Excise Duty would enhance new registrations and future desirability of tractors of this type. However, this has not proved to be the case and we have subsequently continued the previous trend.
We do, however,feel that further decreasing numbers of new registrations this year will ensure future supply and demand is more balanced,reducing the likelihood of further significant reductions from now on.
We have reduced our predictions for the sector as a whole, but within that there have been some changes in the relative value positioning between manufacturers.
Scania has suffered the biggest reduction due to a number of reasons: vastly increased availability, the fact that the cab doesn't have a flat floor (which makes it less desirable), and the replacement of the present series.
This has let the Volvo FH12 slip past into first place; it has recently undergone a thorough facelift, and is well-proven and popular with operators and drivers alike.
The Daf XF has also had a makeover, and is again a popular choice in the used market. These three models should remain 'the pick of the bunch',but future residual values are very close with only £225 separating them.
We then turn to 'chasers': five vehicles make up the rest of the pack, and there have been several changes in position amongst the ranks.
The Actros has slipped from 5th to 7th over the past three years, with used tractor buyers sceptical about the complex electronics (which did cause some problems for early Actros models). The later versions are much improved,but the reputation remains and will take some time to overcome.Again, there is now a new version of the Actros that promises great improvements (the values for which are not included in this data).
MAN has improved its positioning with the introduction of the TG-A range, and this model seems to have overcome its initial teething problems MAN's brand image is improving, but is not as good as the top three. Another improver is Iveco: the introduction of Straits — a huge improvement over the outgoing EuroStar — has seen it rise two places in the pecking order. This model now has genuine driver appeal and seems to be giving good fuel returns. It remains to be seen if Iveco returns to high discounting, which could have an effect on future values.
The Renault Premium has held its own over the past three years in terms of sector positioning, but is not really perceived as anything other than a 'fleet' tractor, even with the Privilege cab. It is a reliable and dependable vehicle that does everything adequately, but seems to lack the 'sparkle' that would make it stand out from the crowd.
ERF has suffered turbulent times recently, with well-documented controversy that has had a severe effect on confidence about the brand's long-term prospects — which is reflected in our predictions.The introduction of the ECX in 2000 was an improvement over the long-running EC range, but it enjoyed one of the shortest production runs ever when it was replaced by the ECT in late 2002.As can be seen on the chart, there was a significant re duction in predicted residual value during 2002 despite the introduction of the new ECT.
Lastly, we turn to Seddon Atkinson. In recent years, it has specialised in municipal vehicles and its conventional vehicles, especially tractors with only a handful of customers, have lost much of their appeal. Recently it has transferred production from Oldham to Madrid as it becomes even further integrated into the Iveco group.This has done nothing to enhance its attractiveness in the used market, which again affects the predicted residual values.
Relative stability
We now expect a period of stability in residual values and there are only one or two revised models due next year — which are likely to be facelifts rather than all-new versions.
The next potential factor that could affect values will be the introduction of Euro-4 emissions legislation. Currently there seems to be two approaches to compliance: either exhaust gas re-circulation (EGR) or exhaust after-treatment with a catalyst/urea injection system. It remains to be seen which approach different engine manufacturers will take to Euro-4 — there could be significant variances in fuel consumption between the two proposals.