Welcome to the WHAT THE TRUCK?!? Newsletter presented by Dunavant. In this issue, used truck prices and spot rates fall; Pete’s new truck; self-driving data hogs; and more.
Used truck prices plummet along with market
Down $55,000 — If you’ve been holding off on buying a truck due to the massive inflation in that space, that chart above shows you made the right call. FreightWaves’ Tanner DeHart tweeted, “3 year old truck prices have fallen $55,000 since their peak a year ago. A $140,000 truck is now worth $85,000.”
“Defaults are seemingly inevitable at this juncture given high interest environments hampering consumer demand and no short-term recovery [in sight] for spot rates.” — CarpeDiemLogic
Default — Now for the bad news: If you already bought a truck on a 5-year 6% interest payment, only $25,000 has gone toward principle. What’s that mean? A lot of recent buyers are now underwater on loans. The longer rates stay in the basement, the less profitable these trucks become. Should the market stay down, we anticipate a rise in defaults.
Near all-time lows — All freight is welcome as tender rejects hit a new cycle low of 2.73%. That’s bad news for the spot market as FreightWaves National Truckload index careens down to $1.48 a mile. Maybe you should wait on getting that truck.
“Shippers say they’d rather spend ‘purposefully more’ than spot rate to lock in better service” — FreightWaves’ Rachel Premack
Under contract, over spot — With margins cut to the bone and many carriers on the brink of shutdown, an unlikely hero has entered the chat: the shipper. Even though rates have fallen more than 25% YoY, reports are coming in of some shippers working with carriers to settle on equitable rates.
According to FreightWaves’ Zach Strickland, “The most recent data shows spot rates are 59 cents per mile lower than contract rates, assuming a fuel surcharge of $2 per gallon.” That’s roughly where the spread between contract and spot was last year. Build those relationships, driver.
Peterbilt 589 is a stunner
What’s old is new — Peterbilt has leaned heavily into its classic styling with the brand new Model 589, which replaces the 389. FreightWaves’ Alan Adler reports, “[Model 589 is] continuing a tradition of long-hood, squared-grille beasts with 7-inch vertical chrome exhausts and 15-inch-diameter chrome air cleaners that lend to the distinctiveness of the trucker’s truck.” So, how does it run? Adler says, “Though engine noise was present, little of it seeped into the cab, providing quietness comparable to near-silent battery-electric electric trucks.”
What do truckers think? — While I think the truck looks like a beast, we wanted to know how drivers felt about it so we asked the community.
Michelle Kitchen: Good looking ride. That windshield sure changes the appearance.
Billy The Kid: The 2.1 meter cab is my gripe. That’s all they changed. The interior of those suck especially if you are going for the old school, which is what a Hopd truck is. You’ve been able to get a one piece windshield for a long time but very rare. This is just a 579 cab though.
Trucking Czar: Well Peterbilt just streamlined their production line by now only having 1 cab in their Class 8 truck lineup.
Pier Trucker NY/NY: It’s too aerodynamic.
SnapShotFreak: The dash is horrible, IMO. My first time in a Pete was like stepping into the cockpit of a plane. All the gauges and switches were mesmerizing! Half the switches aren’t within easy reach, no place to put stuff while driving. Blah!
BestPass: Classy and sleek! 😍
SuperTrucker: Windshield is tilted a bit far back
David Boreman: Send me the address so I can pick it up.
Self-driving data hogs?
$350,000 a year in data? — In all the talk about self-driving trucks, one thing that hasn’t come up much is the high cost of data. Autonomous trucks are massive data mines collecting video from an array of cameras, GPS locations, driving speeds and a whole host of analytics. Wired reports, “Intel estimated in 2016 that each autonomous vehicle would generate 4,000 gigabytes of data per day, a volume that would cost about $350,000 to store for a year at Amazon’s current prices.”
“Waymo started testing the Jaguar I-Pace in late 2019, the crossover SUV came with more powerful sensors that generated a bigger stream of information — to the point that full logs for an hour’s driving equated to more than 1,100 gigabytes, enough to fill 240 DVDs.” — Wired
Maximalism — Cruise reports that only 1% of the data its self-driving taxis collect is useful. University of Delaware’s Weisong Shi told Wired, “We haven’t reached the point where we desperately need more storage, but this day will be coming soon.” His concern? Mass production. If AV’s are already stretching data servers to the brink, what will happen when fleets actually start adopting them?
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WTT Friday
How NASA’s supply chain works, moms in trucking and spot market sinks — On Friday’s episode of WHAT THE TRUCK?!?, I’m talking to NASA’s Katie Rogers about how the space agency’s supply chain works on Earth and in space.
Mother truckers, this one is for you. IMC driver trainer and mother Meghan Turner joins the show to speak to why pulling containers is a good job for mothers and debunk some of the common misconceptions about why women shouldn’t be drivers.
FreightWaves Market Expert Donny Gilbert delivers a data-driven breakdown of the trucking market and explains why carriers are in for a cruel summer.
Plus, news, weirdness and more.
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Transportation employment, freight AI and getting the most out of fuel cards
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Dooner