5 Reasons Why Used Trucks Are so Expensive?
You’ll be pretty hard-pressed to find an automaker that doesn’t already make or have plans for a pickup truck. Trucks are the lifeblood of the American roadway. While big names, like Ford’s F-Series, Chevrolet’s Silverado, and Ram’s lineup of trucks paved the way for working folks, farmers, and off-roaders, trucks and their automakers have transitioned. Now with others like Nissan’s Titan, Toyota’s Tundra, and even Tesla’s Cybertruck, consumers have more capability and options in today’s truck segment. But used trucks are so expensive.
Light-duty, heavy-duty, hybrid, diesel, off-road, and luxury are all available features for today’s pickups. If you want a family vehicle, there’s a quad-cab. Do you need to tow a boat or horse trailer? There are hauling packages for you. However, these used truck prices are sky-high. Here are five contributing factors behind why used trucks are so expensive.
1. Trucks are desirable is a reason why used trucks are so expensive
When there is increased consumer demand for any product, and it becomes highly desirable, the price goes up and remains high. Forbes says as of January this year; new trucks are actually outselling new cars at a rate of three to one. Vehicle History says a pickup truck is the best-selling vehicle in 39 of all 50 states. That’s in part to the pickup transitioning into new luxury, family-friendly, and daily driver rides. Consumers love their beefy trucks for off-roading and working applications. But today’s trucks are harnessing even more durable materials, innovative technology, and plushier touch points.
2. Used trucks aren’t that much cheaper
Used truck prices aren’t that far off from new truck prices, which contradicts the old adage that buying used would save money. Used truck prices have soared in recent years, hitting an average of $40,000 in 2021. Some pickups with more robust features and capabilities are going for more than brand-new models.
3. Longer loans make trucks feel affordable
Trucks can appear more affordable if you’re only looking at the monthly payment commitment to buy one. But don’t be fooled. Loans are getting longer, as Gear Patrol points out, essentially lowering those monthly truck payments. It used to be a traditional vehicle loan would be for three years. But now, some consumers are financing five and even seven years out to pay for a vehicle they probably wouldn’t otherwise be able to afford.
4. The famed Chicken Tax is a reason why used trucks are so expensive
Another factor contributing to high used truck prices is the Chicken Tax. Big automakers faced fierce competition from overseas manufacturers. In retaliation for the European tariffs on chickens, the U.S. responded with the “Chicken Tax” in 1964. This tax adds a 25% tariff on foreign light pickups and is still in place today to protect the domestic truck market. If Nissan, Isuzu, and Toyota want to drive down their prices, they must build their trucks on U.S. soil.
5. Manufacturers can lower or get rid of incentives.
Truck incentives and bonuses work differently than traditional production line fleets. When automakers adjust the MSRP of their portfolios in line with economic demand, they take a different approach to pickups. Instead of modifying the purchase price of a truck, manufacturers will offer cash back, special financing deals, and other “buy now” incentives that create the illusion consumers are getting a deal. But in the end, they’re not dropping the MSRP at all.
Don’t presume that buying used will save you much when buying a pickup. For these reasons and ongoing demand for today’s more fuel-efficient, luxurious, and safer models, buying a used truck will be just as significant of an investment as buying a new one.