Equipment World Digital Magazine
Issue link: http://read.dmtmag.com/i/860257
August 2017 | EquipmentWorld.com 20 S upply and demand determine the price of used equipment, but other less apparent influences also move the needle. Location is one such influence. "This year we are seeing certain geo- graphic pockets doing better than oth- ers," says Brian Sandon, eastern U.S. sales manager, J.J. Kane Auctioneers. "One area might do better than the next, even though it's just a couple hours away. It's been hard to pinpoint consistently." The general trend in the Southeast and the West is a strong, growing economy and rising prices and demand. "Residential building and distribution have spiked up in the Southeast, and out West, the housing market has started to boom again, even in Las Vegas," says Sandon. Prices remain steady, trend upward In general, equipment prices in 2017 are similar to, or higher than, what the industry saw in 2016, says Doug Olive, senior vice president, pricing, at Ritchie Bros. There are a few particularly strong categories related to light construction, such as skid steer loaders, loader back- hoes and smaller wheel loaders, he says. "Right now, equipment is in tight sup- ply since it's out working. Also, OEM production was reduced for certain models between 2014 and 2016, so there is less equipment on the market," says Olive. "Because of this, there are many sellers looking to take advantage." "It's hard to find good, late-model construction equipment right now that's not worn out and beat up," says Sandon. Some reasons: Utilization is up. Rental companies are hanging on to their fleets longer. And at ConExpo this year, orders came in strong, and manufacturer lead times for new equipment are now stretching out. "You just can't call up and have one delivered in a week like you used to. You might wait up to three or four months, depending on the product," he says. All of these factors may prompt a buy- er to go to the used equipment market. "Used prices are trending up," says Mike Womble, branch manager for Anderson Equipment, based in Buffalo, New York, "which can make it a good time to sell." Kenneth Tysinger, used equipment sales manager for May Heavy Equipment in Lexington, North Carolina, adds a caveat: "While used equipment prices are up year over year, there has been some softening," he says. "You would probably be better off to hold off on selling until the end of the year, if possible." But buying is a split proposition, Tysinger adds. "New and used equipment prices are up, but there are a lot of good finance options on the market right now. These are enough to persuade buyers to pull the trigger." (For more on used equipment finance options, go to page 28.) Si Hanna, general manager of remarketing and fleet management for RDO Equipment based in Hewitt, Texas, says equipment prices seem to have stabilized and even rebounded in some segments. "There is a lot of activity happening in the market, and from a dealer perspective, that means opportunity," he says. "I think over the past 18 to 24 months, the market has favored the buyer because of the used equipment report | staff report Also included in this report: How does the No. 1 rental company dispose of its equipment?...p. 23 Contractor buying and selling strategies...p. 24 Plenty of credit available for used equipment buyers....................p. 28 Buyer's market for used vocational trucks may be waning.............p. 32 Regional demands drive used prices By Tom Jackson and Chris Hill