1.877.GETS.UTA • www.uta.org Volume 19 • Issue 7 • July 2017

Used Truck Association Chartered May 16, 1988 Published by the Used Truck Association Lou Ferrigno, aka “The Incredible 303 Corporate Center Drive, Suite 300A Stockbridge, GA 30281 Hulk” to Keynote UTA’s Convention

Table of Contents o matter when you came of Board News and Views...... 2 Nage over the past 50 years or so we bet you’ve heard of Lou Quips & Quotes...... 2 Ferrigno, or his alter ego, “The The Brooks Group Incredible Hulk.” As we briefly Sales Tip of the Month...... 2 mentioned in last month’s New Members...... 3 newsletter, Mr. Ferrigno will Face to Face with Kari Rihm...... 4 keynote this year’s UTA WIT Teams with Dock411 Convention to be held at The Paris to Boost “Gravy Loads” ...... 5 Las Vegas Hotel & Casino in Las Vegas, NV, November 1-4. Industry Events Calendar...... 5 2017 UTA Kansas City Golf Outing...... 6-9 Although Lou lost 75 percent of his hearing by the time he was a How the NMTA Empowers toddler, he was undeterred by what My Customers...... 10 some would see as a disadvantage. The Power of Little Ideas: Instead, he threw himself into Follow the Customer...... 11. athletics, especially bodybuilding. JD Power Valuation Services Update...... 12-13 But you don’t just get to call yourself the incredible Hulk of course. You have to look the part! Lou was only 21 when he won his first Mr. Universe title, a Guinness Book record that still Industry News Briefs...... 14-15 stands. More incredible, at age 22 he won again—and he remains the only person to win 2016 Convention Photos...... 16-17 consecutive titles! Lou carried the world of bodybuilding to new heights and himself to From Where We Sit...... 18 superstardom with the film documentary, Pumping Iron. The UTA… This led to an amazingly successful personal training business including clients such as Mickey Members Supporting Members! Rourke, Michael Jackson, and Chuck Norris; and also led him to write Lou Ferrigno’s Guide to Personal Power, Bodybuilding and Fitness for Everyone. Lou has also earned his acting chops. He’s starred in over 20 films including Cage and Cage II, All’s Fair, Seven Magnificent Gladiators, and Godson. In two unforgettable performances in Hercules and The SHARE YOUR NEWS Adventures of Hercules, Lou fulfilled a life-long dream by playing the legendary Greek hero. with the UTA Industry Watch. Throughout his career Lou has proven over and over Send submissions, ideas and again the value of working hard to overcome chal- comments to: lenges, staying open to new opportunities, and NEVER UTA Industry Watch Editors giving up. These are values that UTA members also share, which is why the UTA is so excited to have Lou Brad and Deb Schepp Ferrigno at this year’s Convention. c/o Sentry Management 303 Corporate Center Drive, Suite 300 A You won’t want to miss this! Come join us in Las Vegas Stockbridge, GA 30281 for this year’s convention, or the six-foot four inch, 285 n Phone: 877-GETS-UTA (877-438-7882) pound Hulk may have something to say about it! Fax: 770-454-0029 [email protected] Twitter: @usedtruckassoc UTA Industry Watch Board News and Views 2017 BOARD OF DIRECTORS I would like to take this opportunity to talk to you about the UTA’s training classes. The UTA offers two classes for our members: Managing for Success and Selling for Success. I am http://www.uta.org/directory not sure why we named them that way, as they offer a lot more than teaching about selling or managing. The classes teach you about customer service and customer satisfaction. GOVERNING BOARD: Most of you probably think that you have to be in sales or a manager to attend these classes. President...... Craig Kendall That’s not the case. We all know that price is not the main factor for a customer when buying a truck. Satisfied customers are going to take your business a lot further than than price alone will. Vice President...... Rick Clark A happy customer is a customer for life. Repeat business is one way to help take your dealership Treasurer...... John Cosgrove to the next level. Advertising only gets us so far. A happy customer will talk about his/her Secretary...... Amanda Kent experience with others, and we all know that is the way to make your dealership stand out. It starts with the initial sale and then financing. President Emeritus.Marty Crawford Then servicing the unit and the customer ordering parts come into play. So what am I COMMITTEE CHAIRPERSONS: saying? Anyone who comes in contact with the customer should take these classes. Convention...... Co-Chairs Rick Clark, The customer talks to and interacts with a lot Hal Dickson and Craig Kendall of people at your location. Wouldn’t you like for everyone to know how to interact with the Dealer Group...... Bobby Williams customer and make him feel good? It will Co-Chairs Mike Roney help your employees be on the same page if and Brandon Hess they have the same training when handling a Elections...... Charles Cathey customer’s needs. September 17-19 These classes will have you and your Courtyard Chicago O’Hare Finance...... John Cosgrove employees coming back to work excited and 2950 S. River Road focused on making their departments a Des Plaines, IL 60018 Marketing...... Rick Clark better environment for the customer! George Co-Chair Amanda Kent Papp has over 30 years experience in the Membership...... John Cosgrove truck business. He not only connects with Co-Chair Kelly Coldiron you on a personal level, but on a professional level too. People who have taken one of his courses come back saying great things about George and his training. Preferred Partners... Brock Frederick We have one training class left this year in Chicago (details to follow). Scholarship...... Dean Jeske Please visit www.uta.org, and click on the training link to sign up. Dates and locations for next year’s classes have not been determined yet but we Training...... Amy Shahan will let you know as soon as they are. Co-Chair Jody Johnson Thank you, Website...... Amanda Kent Co-Chair Rick Clark Amy Shahan Training Committee Chair [email protected]

Motivation will almost always beat mere talent. ~Norman Ralph Augustine People buy for their own reasons—not for yours or mine.

2 July 2017 www.UTA.org UTA Industry Watch

It’s always a treat to welcome new members to the Used Truck Association. Each month we profile our new (or just returning) members in this newsletter. New members have the New opportunity to complete a bio and send a photo so our current members can learn more about you. We hope to learn not just how to reach you, but what you enjoy about the work you do, why you joined the UTA, and what gets your gears going as a person. So please return your Members questionnaire so your fellow UTA members can get to know you!

J.R. Bias Andrew Lamprecht, Sales Nick Roth P.O. Drawer J River States Truck & Trailer Cummins, Inc. Gainesville, GA 30503 www.riverstates.com 1460 National Road (770) 535-7877 (w) (608) 791-4663 (w) Columbus, IN 47202 [email protected] [email protected] (303) 968-7213 (w) After working in the [email protected] Carl Boja automotive industry for seven years, Andrew TravelCenters of America Brian Rush joined the trucking (800) 879-1476 (w) 4500 N Cliff Ave. business in 2016. P.O. Box 451100 Sioux Falls, SD Westlake, OH 44145 He really enjoys getting [email protected] out on the road and “never knowing who you Steve Brostrom might end up getting to Carl Walker, Used Truck Manager Paccar Financial Corp work with.” Doggett Freightliner 777 - 106th Ave NE Andrew’s also passionate about coaching 3103 N. Cage Blvd Bellevue, WA 98004 hockey in the winter and golfing the rest of Pharr, TX 78577 (815) 242-4427 (w) the year, he said. (251) 421-4690 (w) [email protected] [email protected] Coming from a career in car Lijun Lyda Michael Criscione sales, Carl joined us here in Alliance DriveAway Solutions, Inc. trucking in 2006. That’s M&T Truck Sales 210 North Church Street when he joined Rush Truck 7545 S. Madison St. Charlotte, NC 28202 Centers, in Mobile, AL. Burr Ridge, IL 60527 (800) 218-0882 (w) The challenge of “operating (630) 756-2614 (w) [email protected] [email protected] two stores in two distinctly different markets, keeps me Ryan Morrow, President running and thinking,” Carl Eric Davanport Classic Truck Sales, LLC said when asked what he especially liked TravelCenters of America 34880 LBJ Freeway about his job. P.O. Box 451100 Dallas, TX 75146 Now that he’s joined the UTA, Carl’s looking Westlake, OH 44145 www.classictrucksalestexas.com forward to interacting with other members, (800) 879-1476 (w) (972) 755-3986 (w) and being a part of our association. [email protected] Daniel Duran Ryan’s been a part of the Navistar, Inc. trucking industry since 14714 Valley Blvd 1998. Fontana, CA 92335 His first job in trucking (909) 356-4404 was working in a family- [email protected] owned cattle hauling business. As a new UTA member Ryan’s hoping to build relationships within the industry and to gain expertise. In his current job Ryan can help customers realize a dream, which he really enjoys. He also likes the customer and industry relations parts of his work, and helping customers interested in selling assets. Ryan’s goal is to have a “used truck super center in several key marketplaces strategically placed in the U.S., for deep penetration all while making Classic Truck Sales the place to work for my associates.” www.UTA.org July 2017 3 UTA Industry Watch

Kari Rihm

ari became the President/CEO of Rihm Within the last six years, the company has added pioneers in the industry, and external business KKenworth in St. Paul, MN in October two new locations, and Kari is overseeing the experts,” she said. 2015 after her husband, John, passed away. “My construction of a new headquarters for the In advising younger people just starting out in whole career in this industry has been in this company. The company is gaining both heavy trucking Kari noted the value of the trucking role,” she said. Rihm Motor Company was duty and medium duty market share, and they industry. “The transportation industry is the founded by John’s grandfather in 1932, and are also making parts and services more backbone of our economy and way of life,” she John’s father managed the dealership before available to all customer locations. “In addition said. “It is often overlooked, but it employs no John took his turn. “As owner and dealer to the two new facilities in the Twin Cities’ less than 17 million American workers. Jobs in principal, I am responsible for every aspect of market, we are in the preliminary stages of this industry pay well and offer a tremendous the dealership,” Kari explained. “But, I am planning two or three locations to reach the far range of opportunity. It’s evolving in ways that certainly not the subject matter expert in any of corners of our territory,” Kari said. will always offer opportunities to people who them.” Kari notes the good fortune of having Of all the aspects of her job, Kari enjoys interacting dedicate themselves to learning and improving well-seasoned professionals in every area of with customers and employees most of all. “I their knowledge and skills. Transportation jobs every location within the dealership. “From my like to hear what is happening in the industry will never go away. This is not a fad or a fading vantage point, I participate in discussions from the customers’ perspectives,” she explained. part of the US marketplace.” regarding large orders and trade packages, “I like to hear from employees about their ideas Kari shared her perspective on what is ahead for strategies to move used inventory, parts and on how to improve processes and services. Both service promotion, etc.” she said. the used truck industry. “Manufacturers respond activities give me insight into what customers to new government regulations and economic Kari’s larger role is one of business development expect and need and what our employees think stressors, and they have an impact on used truck and long-term growth planning. “Currently I about the situations they encounter every day sales. There will always be peaks and valleys. am working to integrate common functions that can improve everyone’s experience with Truck configurations that are popular today may between Rihm Kenworth and our newly formed the dealership.” When asked what she wishes not be when they enter their second life (Day cabs and related company, Rihm Leasing, Inc., which she knew earlier in her career, Kari responded, were in high demand in 2011-2012, because of operates our recently acquired NationaLease “Everything, and that’s an understatement!” low unit production in the preceding cycle affiliate, Rihm NationaLease (formerly Lawrence She is quick to acknowledge the expertise, devo- 2008-2010. Sleepers were popular earlier in the NationaLease) and the soon to be launched tion, and professionalism of Rihm Kenworth’s decade but have declined in demand, etc.),” she Rihm PacLease franchise,” Kari explained. staff, and the profound hard work of her late said. “Now there is a glut of day cabs, because “When you own a leasing company, you own a husband, his father, and grandfather. When of the ramp up of new truck production during lot of used trucks! I’m on a very fast learning asked about her proudest moments in the 2011-2014. Difficulties with after-treatment systems curve on this operation as well.” industry to date, she turns all the credit back to during the early years of implementation of Rihm’s core business is now 85 years old and them. “I have experienced many incredible that technology have dogged these trucks in the enjoys an excellent regional reputation. awards,” Kari recalled. They include: secondary market. Sleepers are less popular ■■ Kenworth Truck Company Medium Duty because routes have been modified to shorter Dealer of the Year – 2011, 2012 and 2014 turnarounds to attract drivers who want to be ■■ Family Business Honoree 2013 – Twin Cities home daily. There is always cause and effect, so Business Magazine developing a healthy network of individual, ■■ NAWBO Minnesota Pioneer Award – 2014 fleet, and wholesale buyers is imperative. – National Association of Woman Business Change, challenges and new regulations will Owners continue to impact the used truck market.” ■■ ATD Dealer of The Year Nominee – 2015 Kari has two grown children, one of whom works – American Truck Dealers Association with her at the dealership and another who is a ■■ Influential Woman in Trucking – 2015 student. She enjoys spending time with them, – Women in Trucking especially at the family’s cabin or on extended trips. ■■ Inductee in the Minnesota Women Business Understandably, the demands of her career have Owners Hall of Fame – 2017 kept Kari extremely busy, but she still enjoys ■■ Recipient of the Ernst & Young Entrepreneur reading and keeping up to date with current of the Year Upper Midwest Award – 2017 events. “When I have the chance,” she said, “I “These are proud moments, because they also still enjoy cooking and entertaining friends and represent recognition from our OEMs, peers, relatives.” n

4 July 2017 www.UTA.org UTA Industry Watch WIT Teams with Dock411 to Boost “Gravy Loads”

omen In Trucking (WIT) “Were you treated like a professional?,” and WAssociation’s mission includes “Were the restroom facilities adequate?”. removing obstacles that might keep women Doc411 says the app’s purpose is to better from entering or succeeding in the trucking prepare both female and male drivers for industry. One obstacle drivers often mention “their warehouse facility experience.” is not knowing how to prepare for a pick up Doc411 feels this may improve the industry or delivery. This may include directions to the by removing unexpected surprises from the facility, whether pets are allowed, if Wi-Fi is pickup or delivery operation. available, and any challenges involved in backing into the dock. “A driver once told me how he defined a ‘gravy’ load,” said WIT President/CEO Ellen Voie. Dock411’s goal is to make a driver’s stops faster, “He said it was a shipment with no surprises, easier, safer, and less frustrating by providing and now with the Dock411 app, any driver can details about stops before drivers arrive. By be better prepared and will be able to anticipate merely entering the dock address into the app, challenges before he or she arrives at the dock. drivers can read what the company and other With Dock411, every load can be a ‘gravy load.” drivers have written about it, including details like dock door location, yard hazards, photos For more information, visit dock411.com or of the facility, the ability to park overnight, email [email protected]. Download the app whether pets are allowed, and up to 35 other in iTunes or Google Play. n items. After the stop, drivers can add their own details. Women In Trucking Association, Inc. is a nonprofit association established to encourage Shippers are encouraged to enter information the employment of women in the trucking about their facility by completing an online industry, promote their accomplishments and form. This helps speed the loading experience minimize obstacles faced by women working and can eliminate unnecessary delays from in the trucking industry. Membership is not driver or dispatcher miscommunication. limited to women, as 17 percent of its The current version of the Dock411 app includes members are men who support the mission. three questions WIT requested specific to For more information, visit www.womenin- female drivers: “Were the personnel helpful?,” trucking.org or call 888-464-9482.

Industry Events Calendar JULY OCTOBER MARCH 2018 20 • American Trucking 11-13 • National Trailer 6-9 • NTEA, The Work Truck Associations Economic Dealers Association Annual Show Summit Convention Indianapolis, IN ATA Headquarters & The Westin TPC Sawgrass Marriott http://www.worktruckshow.com/ Arlington Gateway, Arlington, VA Ponte Vedra Beach, FL www.trucking.org/event/12596/2017- http://ntda.org/ 22-24 • Mid-America Trucking ATA-Economic-Summit Show Kentucky Exposition Center NOVEMBER Louisville, KY SEPTEMBER https://www.truckingshow.com/ 1-4 • 18th Annual UTA 17-19 • UTA Sponsored Convention Training: Selling for Success Paris Las Vegas • Las Vegas, NV 2017, Chicago http://uta.org/uta-annual-convention/ Courtyard Chicago O’Hare uta.org/uta-sales-training-events 25-29 • North American Commercial Vehicle Show Georgia World Congress Center Atlanta, GA http://nacvshow.com/ www.UTA.org July 2017 5 UTA Industry Watch UTA’s 2017 Golf Open Draws Generous Crowd 10 Scholarships to be Awarded

he UTA’s 12th Annual Jerome Nerman Family Foundation TKansas City Golf Open, held June 21 – 22, once again scored a hole-in-one. As Amanda Kent noted, Dean Jeske and the Scholarship Committee did a fabulous job in picking the course (the Staley Farms Golf Club, Kansas City). Most importantly, special thanks goes to our generous sponsors. They were (as always) so willing to give to the great cause of helping our young people further their educations. Because of everyone’s support, the UTA will award 10 scholarships this year! A huge thank you to Lewis Nerman who so graciously donated $10,000 after the tournament. Lewis also spoke heart-warmingly about his father, Jerry, who had the original vision for the Scholarship fund. Sadly, Jerry died in February, but his presence was felt by all who attended the Outing. “My dad felt strongly about the UTA and the Scholarship Fund,” Lewis recalled. “He always wanted to help students to enhance and better their lives, perhaps because he 1st himself didn’t have the chance to pursue his education. And he loved the UTA and all the people—the UTA just meant the world to him.” The Golf Awards 1st Place Team with a score of 58 Russell Swartz Wayne Sheets Jim Towery Drew Reynolds

2nd Place Team with a score of 60 Cory Spitcaufsky 2nd Lee Wallace Robert Yost

3rd Place Team with a score of 61 Brian Lawlor Larry Moran Brian Lawlor Jr.

Closest to the Pin: John Barrett

TWO Longest Drive Awards: Chuck McCann

Longest Drive Award: Brian Lawlor 3rd And Robert Yost won this year’s Marty Crawford Chicken Leg Award

The UTA could not have pulled off this event without Sentry Management (David Grace, Misty Feltman Reis) and our graphic designer Laura Jones Carter, who helped coordinate things behind the scenes. Everyone is looking forward to returning to Kansas City next year. Mark your calendars now for the third week of June 2018! n

6 July 2017 www.UTA.org UTA Industry Watch Remembering Jerry Nerman

John Barrett Closest to the Pin

Chuck McCann TWO Longest Drive Awards

The Story Behind the Marty Crawford Chicken Leg Award Lifetime Achievement Award winner Marty Crawford has definitely had a life of many rewards and achievements. But perhaps the one for which he is most widely known is the Chicken Leg Award. Marty began playing golf within the last decade or so, and sadly his game has not improved much. “I have managed to get worse at it each year,” he once said. In 2006, Marty joined a foursome to play in the first UTA-Jerome Nerman Golf Outing. Marty’s wife, Marietta, warned his group that their newest member would show up in shorts that would highlight his legs. “Marty’s legs look like two frozen Perdue drumsticks,” she said. Since her description was so accurate, Terry Williams put the new award in motion by the second hole! The award, a KFC container with a dozen frozen chicken legs became an instant hit. “I accept this award for one good reason,” Marty said, “I deserve it!” Brian Lawlor Longest Drive Award www.UTA.org July 2017 7 THANK YOU UTA Industry Watch to our Generous Sponsors

8 July 2017 www.UTA.org UTA Industry Watch

June 17 & 18th, 2010

www.UTA.org July 2017 9 How the NMTA Empowers My Customers

by Courtnay Beckham

his is not a story about me­—but about what the National Minority TTrucking Association (NMTA) provides for my customers. Some time ago, I met with Kevin Reid, NMTA’s founder and CEO, to learn more about his vision for the association. I learned we shared the same vision and beliefs about the industry, and what it will take to build the right foundation. I consider myself more of a teacher than a salesperson. I feel it’s important to ensure my customers have the tools and network in place to succeed. So I always give them a folder filled with contacts, industry mate- rials, and tools I think will help them. Kevin was just starting the NMTA when we met. He wanted to bring a light to this industry and a way to succeed in it. He has done that in an incredible way. NMTA provides workshops, classes, and tools that are priceless to my customers. I direct almost every customer that comes in my office to the NMTA. I am a member myself, and feel as a woman I can be a great advocate for what the NMTA stands for. This leads to the story of Melodie Goodwin (now M.R Trucking LLC.–as she is now a company!) Melodie recently called me and said “You probably don’t remember me, but you spoke with me at the NMTA Truckers Opportunity Expo three years ago. You talked about everything I needed to do, and gave me direction in how to succeed in this business. We didn’t talk about Courtnay Beckham is the National Fleet trucks—we talked about getting educated in every aspect of the business before jumping in.” Sales/ Consultant for SelecTrucks of Atlanta Over the next three years, Melodie worked on everything. She took classes and workshops with the NMTA, and took advice from their experts in the business. She was then ready to buy a truck. I worked hard on getting her financing in place, which is never easy for a start up. We finally were able to match the right truck with her finance option and put a deal together. She recently closed and soon thereafter picked up her truck. What an exciting (yet stressful) time for her. There is a saying I put in every truck I sell: ~Some people dream of success while other people wake up and work hard at it! Melodie is a prime example! n

Register Now for the Event of the Year!

10 July 2017 www.UTA.org The Power of Little Ideas: Follow the Customer by David Robertson and Kent Lineback

he first step and the foundation for all that follows is to lay out the complete set of activities Tstarting when your customers first sense a need for your product and then find, buy, use, maintain, repair, and then dispose of it. This customer activity chain is the core of the customer context. The key to following the customer is to look behind your customers’ activities and understand what they’re trying to accomplish with your product at every step along the way as they find and use it. Customers often cannot express, explain, or even know what they want or need. How can they, if they don’t know what’s possible? But they can tell you something even more useful: the job they’re trying to do, the outcome they’re trying to accomplish, and the result they want to achieve, when they use your product. Once their overall goal or job has been identified, every step in the chain of activities leading up to completing that job can be evaluated in light of the ultimate result being sought. This jobs-to-be-done approach, as it has come to be called, arose from Theodore Levitt’s still-relevant Harvard Business Review article “Marketing Myopia,” which first appeared over a half-century ago. In it, Levitt argued that people buy a product not for itself but as a means to accomplish some task. The now-classic example of this concept is that people don’t buy a drill because they want a drill; they buy a drill because they want a hole. The appeal and power of this approach is that many products force the user to compromise because they don’t do the complete job the user wants done. That’s frustrating because it forces users to cobble together their own solutions around the product. The Third Way is an ideal method for dealing with this situation. By knowing what outcome your key customers are trying to Reprinted by permission of Harvard achieve, you can begin to discern needs they cannot yet express directly. By adding complemen- Business Review Press. Excerpted from The tary innovations around the product, you can provide a solution that does the whole job. Power of Little Ideas: A Low Risk, High Reward Approach to Innovation by David GoPro’s early success can be traced to its deep understanding of what customers were trying to Robertson. Copyright 2017. All rights do with its products. From the process of mounting the camera, to planning which parts of the reserved. experience to record, to editing the video, GoPro has developed an integrated set of products, accessories, and tools that support the entire process . To document the customer activity chain, break down the user’s activities into separate steps, describe each, and then ask users what job they’re trying to accomplish with each. Finally, question the user to gather two additional pieces of information about each of the steps in the chain. First, rank the importance of each step to getting that job done. Each step can range from crucially important to entirely optional. Second, rank how satisfied the user is with the way that step is getting done now. This information will come from observing customers, asking what purpose or job they are seeking to do, and then having them rate each step for importance and satisfaction. n

Networking Fun and Exciting Tours Informative Speakers and, well… It’s VEGAS, Baby! www.UTA.org July 2017 11 UTA Industry Watch J.D. Power Valuation Services Update Chris Visser, Senior Analyst and Product Manager, Commercial Vehicles

June Market Returns to Expectations in May were 10 months newer, had 19,174 (3.6 percent) fewer miles, and June’s Class 8 auction results were back to normal, with volume up brought $100 (or 0.4 percent) less money. Compared to May 2016, the notably, and pricing down mildly compared to last month. Retail average sleeper sold this month was 25 months newer, had 108,630 (or selling prices remain stable, with minimal depreciation. The medium- 17.5 percent) fewer miles, and brought $962 (3.3 percent) less money. duty market retracted moderately. The average wholesale selling price of 3-5 year-old sleepers stabilized in May. A low volume of model-year 2015 trucks combined with large Sleeper Tractors – Auction/Wholesale groups of similarly-equipped units continues to cause swings in this Volume of the most common sleeper tractors sold at auction increased monthly average. Average wholesale pricing for this cohort was dramatically in June after a depressed May. Pricing of our benchmark $42,746 - $1,343 (or 3.2 percent) higher than April. model decreased 2.8 percent compared to last month, which is somewhat higher than expectations, but much less dramatic than May’s drop. Average pricing by age was as follows: 3 year-old trucks: $72,101 - $14,016 (24.1 percent) higher than April June auction performance of our benchmark model was as follows: 4 year-old trucks: $27,535 – $6,849 (24.9 percent) lower than April MY2013: $28,000 average; $27 (0.1 percent) lower than May 5 year-old trucks: $28,603 - $3,138 (9.9 percent) lower than April MY2012: $23,250 average; $1,685 (6.8 percent) lower than May MY2011: $20,250 average; $358 (1.7 percent) lower than May On a year-over-year basis, late model trucks sold in the first five months of 2017 are averaging 3.5 percent lower than the same period of 2016. In the first half of the year, trucks of model year 2011 averaged 3.7 percent depreciation per month, trucks of model year 2012 depreciated See the “Average Sleeper Tractor Pricing by Model Year (All Wholesale)” 1.8 percent per month, and trucks of model year 2013 have averaged graph for detail.

less than 1 percent (low January pricing was negated by higher Average Sleeper Tractor Pricing by Model Year (all Wholesale) February through June pricing). $90,000 2 per. Mov. Avg. (2007) $80,000 2 per. Mov. Avg. (2008) We did not consider May’s atypical results particularly notable, since $70,000 2 per. Mov. Avg. (2009) $60,000 2 per. Mov. Avg. (2010) one month does not make a trend. June’s results were on par with the $50,000 2 per. Mov. Avg. (2011) $40,000 2 per. Mov. Avg. (2012) 2 per. Mov. Avg. (2013) longer-term trend, and we continue to view the auction market as firming. $30,000 2 per. Mov. Avg. (2014) $20,000 See the “Volume of all Aerodynamic Sleeper Tractors Sold…” and $10,000 “Average Selling Price: Benchmark Sleeper Tractor” graphs for detail. $0 15 16 17 Jul Jul - - - Jun Jun Oct Oct Apr Apr Apr Feb Feb Feb Sep Sep Dec Dec Aug Aug Nov Nov Mar Mar Mar May May May Jan Jan Jan

Source: J.D. Power Valuation Services Jun (Est.) Volume of the Three Most Common Sleeper Tractors Sold through the Two Largest Nationwide No-Reserve Auctions (Model Years 2011-2013) 800 Sleeper Tractors – Retail 700 The average sleeper tractor retailed in May was 72 months old, had 600 500 448,696 miles, and brought $48,929. Compared to April, the average 400 sleeper was 2 months newer, had 3,785 (0.8 percent) fewer miles, and 300 brought $460 (1.0 percent) more money. Compared to May 2016, this 200 average sleeper was 2 months older, had 19,301 (4.1 percent) fewer 100 0 miles, and brought $6,469 (11.7 percent) less money. The retail market overall averaged 9.9 percent lower pricing in the first five months of 2017 compared to the same period of 2016. Source: J.D. Power Valuation Services Looking at trucks three to five years of age, retail selling prices have Average Selling Price: Benchmark Sleeper Tractor Sold through the Two dropped an average of 1.7 percent per month so far in 2017. This figure Largest Nationwide No-Reserve Auction Companies compares favorably to the 2.4 percent per month average in the first $70,000 MY2011 five months of 2016. $60,000 MY2012 $50,000 MY2013 Average pricing by age was as follows: $40,000 3 year-old trucks: $81,728 - $6,677 (8.9 percent) higher than April $30,000 4 year-old trucks: $60,675 – $92 (0.2 percent) higher than April $20,000 $10,000 5 year-old trucks: $44,900 - $3,849 (8.4 percent) lower than April $0 On a year-over-year basis, late-model trucks sold in the first five months of 2017 are averaging 6.4 percent lower than in the same Source: J.D. Power Valuation Services period of 2016. Keep in mind the varying mix of models sold each month can result in swings in our averages. Multi-month trending The larger overall wholesale environment (auction, dealer-to-dealer, and shows the retail market leveling out, with depreciation quite minimal. dealer-to-wholesaler combined) dipped slightly in May (June results See the “Average Retail Selling Price: 3-5 Year-Old Sleeper Tractors” were not yet available at the time of this writing). Average pricing in graph for detail. the first five months of 2017 is running 6.8 percent lower than the same period of 2016. The average sleeper tractor sold wholesale in May was 60 months old, had 513,859 miles, and brought $28,442. Compared to April, trucks sold

12 July 2017 www.UTA.org UTA Industry Watch

Average Retail Selling Price: 3-5 Year-Old Sleeper Tractors Month-over-month fluctuations aside, pricing for newer, lower-mileage Adjusted for Mileage trucks has been generally stable since January on average. Buyers continue $100,000 to look for the newest equipment available. $90,000 $80,000 See the “Average Wholesale Selling Price: 4-7 Year-Old Class 3-4 $70,000 $60,000 Cabovers” graph for detail. $50,000 $40,000 Average Wholesale Selling Price: 4-7 Year-Old Class 3-4 Cabovers $30,000 4YO Adjusted for Mileage $20,000 5YO $10,000 3-5YO Avg. $25,000 $0 $20,000 15 16 17 Jul Jul - - - Jun Jun Oct Oct Apr Apr Apr Feb Feb Feb Sep Sep Dec Dec Aug Aug Nov Nov Mar Mar Mar May May May

Jan Jan Jan $15,000 Jun (Est.) Source: J.D. Power Valuation Services $10,000

$5,000 Drilling down to individual models, the Peterbilt 579, Kenworth T680, $0 15 16 17 Jul Jul - - - Jun Jun Oct Oct Apr Apr Apr Feb Feb Feb Sep Sep

Volvo VNL 730/780, and Freightliner Cascadia continue to outperform Dec Dec Aug Aug Nov Nov Mar Mar Mar May May May the market average. The apparent outsized strength of the 579 is due to Jan Jan Jan Jun (Est.) a disproportionate number of model-year 2015 trucks rather than high Source: J.D. Power Valuation Services pricing in all three model years. At the same time, this model is generally performing at the top of the market. The conventional market retracted in May. Both the heavier and lighter See the “Average Retail Selling Price of Selected 3-5 Year-Old Sleeper GVW segments pulled back notably, with lighter segments continuing Tractors” graph for detail. to bring higher pricing than heavier segments. Average Retail Selling Price of Selected 3-5 Year-Old Sleeper Tractors Specifically, Class 4’s averaged $18,640 in May. This figure is $2,348 Adjusted for Mileage (11.2 percent) lower than April, and $4,360 (19.0 percent) lower than 386 $100,000 387/587 unusually-high May 2016. Class 6’s averaged $15,211 in May. This figure $90,000 579 $80,000 Cascadia is $4,771 (23.9 percent) lower than April, and $2,599 (or 14.6 percent) $70,000 CX $60,000 lower than May 2016. ProStar (ISX+MF) $50,000 T660 $40,000 Through May, Class 4 trucks are running 2.1 percent ahead of the same T680 $30,000 VNL 630/670 period of 2016, with mileage averaging 1.1 percent higher. Pricing for $20,000 VNL 730/780 $10,000 Class 6 trucks is 10.2 percent lower, with mileage 18.1 percent higher. Market Average $0 Volume for Class 4 was moderately higher than last month, while volume for Class 6 decreased dramatically. We still see demand continuing to incrementally improve in upcoming months for trucks of all GVW Looking at the number of retail sales per rooftop, our early estimates classes, based on general macroeconomic trends. of a poor showing in May turned out to be unfounded. Dealers who reported sales early in the month sold fewer trucks than those who See the “Average Wholesale Selling Price: 4-7 Year Old Conventionals by reported later, throwing off our early assessment. May was actually a GVW Class” graph for detail. strong month, with dealers retailing 5.8 trucks per rooftop. This figure Average Wholesale Selling Price: 4-7 Year-Old Conventionals by GVW Class is 0.6 truck higher than April, and a full 1.0 truck higher than May Adjusted for Mileage 2016. This result puts 2017 0.6 truck ahead of 2016. Dealers should be $30,000 feeling some improvement at this point. $25,000 See “Number of Trucks Retailed per Dealership Rooftop” graph for detail. $20,000 $15,000

Number of Trucks Retailed per Dealership Rooftop $10,000 7 2 per. Mov. Avg. (Class 4 Price) $5,000 6 2 per. Mov. Avg. (Class 6 Price) 5 $0 4 3 2 1 Source: J.D. Power Valuation Services 0 15 16 17 Jul Jul - - - Jun Jun Oct Oct Apr Apr Apr Feb Feb Feb Sep Sep Dec Dec Aug Aug Nov Nov Mar Mar Mar May May May

Jan Jan Jan Forecast Jun (Est.) Source: J.D. Power Valuation Services June’s results show a return to the expected trend in the retail and wholesale channels. Pricing continues to flatten out. Dealers should be Medium Duty Trucks seeing incrementally improved conditions compared to this time last Starting with Class 3-4 cabovers, pricing of our benchmark cohort year. n dropped again in May, but this time a higher-mileage mix of trucks can’t be blamed. May’s average pricing was $16,869, which was $629 (3.6 percent) lower than April, and $2,118 (14.4 percent) higher than May 2016. www.UTA.org July 2017 13 UTA Industry Watch Industry News Briefs

May Uptick in Used Truck Sales Purchase Intentions at There were plenty of May flowers to go around as used truck dealers Highest Level Since ‘14: ACT celebrated a May uptick in same dealer sales. The rebound was A full 61 percent of fleets responding to unexpected and helped offset April’s decline. ACT’s latest For-Hire Trucking Index plan “While volumes generally begin to fall off as summer approaches, equipment purchases in the next three months. This was the strongest May’s volumes were up month-over-month, offsetting a portion of three-month reading, ACT said, since 2014’s third quarter. ACT added April’s decline,” said Steve Tam, ACT’s Vice President. “With used that all of the purchase forecasts will be for new equipment. Seven truck prices stabilizing, it appears that truckers could be starting to percent of respondents not planning purchases reported plans to take advantage of the low prices,” Tam added. extend the lease on their current equipment. ACT noted that dealers said used truck sales “appear to be showing Following April’s slowing growth, the volume reading advanced for signs of improvement.” While there’s still an oversupply of trucks , the fifth consecutive month in May to 65.3, over twenty points above “the mood of the used truck business is improving,” said Tam. “There the December 2016 index. Ten percent of respondents reported having is still an excess of late model aerodynamic sleeper trades in inventory, significant gains, 53 percent percent had modest increases, and 33 a fact that continues to cause concern among truckers and financers,” percent were flat. The remaining four percent of fleets had either he concluded. n significant or modest decreases. Said one fleet: “Generally industrial customers seem to be increasing loads slightly, nothing over the top, but generally load counts are moving up.” n

May’s Class 8 Orders Drop to 16,300 Units: FTR April’s TCI jumps Four Points to 7.03 Class 8 net orders for May came in at 16,300 Considered a “mid-positive” range units, according to FTR. May’s order activity dropped 31 percent below April’s, and that April’s Trucking Conditions Index jumped four points to a reading of was below expectations. On the bright side, May 2017’s orders were up 7.03, according market researcher FTR. FTR sees more good news 29 percent from those of May 2016. ahead as freight demand is moving up, as the industrial sector continues to improve with capacity tightening. FTR said May’s “drop was not totally surprising” as fleets have been placing very strong orders for the last several months for second half This year’s first quarter was the second strongest in terms of freight delivery. FTR says its 2017 forecast looks solid if orders maintain this growth of the current recovery. FTR feels that the balance of 2017 will pace through the summer. Total orders for the past 12 months stand at continue to see growth but at a more modest level. 211,000 units. “Overall, our expectation of improvements in freight demand for 2017 “The order numbers are not that worrisome, considering the steady are coming to fruition,” said Jonathan Starks, FTR’s Chief Operating volume of orders over the past seven months,” said Don Ake, FTR’s Officer. However, we are seeing a significant difference between the Vice President of Commercial Vehicles. “It appears the typical contract carriers, specifically those in more dedicated routes, and the summer order slump just showed up one month early. It does indicate spot market. Contract markets are showing limited load growth and the market is functioning normally and there is a steady, not robust, weak pricing, but spot market indicators are telling a very different upward trend. The slowdown in order activity will give the OEMs a story. Data from Trans4Cast.com shows that spot market load activity chance to get production lined up with demand.” in early June was up more than 50 percent compared to the same time last year. Importantly, truck capacity in the spot market is down during Ake added that FTR “still expects the Class 8 build and sales to that same time. This has led to significant rate increases for spot moves, continue to increase as the year progresses.” He added that “May with the average rate up more than 10 percent on a year-over-year basis.” orders were actually very close to our January forecast, so the market continues to move ahead as expected. Orders should continue at about Starks continued: “We typically see spot markets move prior to the this pace through the summer, which will be good enough to support contract arena, so we would expect to see stronger contract pricing stronger demand in Q3 and Q4.” n negotiations as we finish 2017 and head into 2018. The market is gaining strength, and conditions for carriers are showing significant improvements.” n

14 July 2017 www.UTA.org UTA Industry Watch

Volvo Trucks Debuts Painted Parts Program Navistar Reports Volvo Trucks North America (VTNA) through its new Genuine 2nd Qtr. Loss Painted Parts Program, delivers genuine, factory-built replacement But Sees Better Days Ahead parts, “custom painted for pre-order or quick turnaround. “ Navistar recently VTNA said that through the new program customers and dealers can reported a net loss of order more than three dozen different parts, including hoods and $80 million for 2017’s bumpers, for both the Volvo VNL and VNM models. Replacement second quarter, however parts are painted with the same custom formula and paint used at it sees a better second half “driven by backlog and improving industry VTNA’s New River Valley facility in Dublin, Virginia. conditions.” Volvo expects to ship all hood and bumper orders within 48 hours of “We are on track to improve on last year’s results, but still have quite a request. bit of work to do in the second half,” said Troy A. Clarke, Navistar “Our customers have asked for a solution to reduce their time in the chairman, president and chief executive officer. “However, the work shop as a result of body repairs,” said Michael Leipold, Volvo Trucks we’ve done in the first six months growing share, building our backlog, Parts Marketing product manager. “With this program, our dealers and managing costs, combined with improving industry conditions, can stock or express-order custom-painted pieces for their fleet positions us to deliver a stronger second half.” customers. In some cases, repairs can literally begin on those vehicles Some second quarter highlights: as soon as the truck rolls into the shop. That can mean the truck is on the road days earlier than was previously possible.” Improving Core market share, with additions to the company’s production schedule and extensions of the company’s backlog into the Aside from painted hoods and bumpers, the program also offers bulk fourth quarter. part ordering for all models, and “fully dressed” hoods for the VNL. Fully dressed products come complete with mirrors, headlights and Strengthening competitive presence in the Class 8 market, including grille ready to bolt on and roll. ramped-up deliveries of the new International LT Series with the Cummins ISX 15 liter engine; introduction of the new RH™ Series of Rounding out the program are full cab options. “A complete line of Class 8 regional haul tractors; and unveiling of the new International VNL and VNM cabs are available painted, sealed and ready for final A26 12.4-liter engine, which launches in the LT and RH Series in the dressing at the dealership,” the company said in a media release. The coming weeks. company added that an enhanced, semi-groomed daycab is also n available for both models. All cab options can be available to ship The company reiterated its guidance for the full year. within 20 days of order. “We listened closely to our dealers and customers when developing our catalog of offerings,” Leipold said. “Whether it’s replacing a single piece of the bumper or a complete cab, we believe these factory quality parts can save fleets time and money.” Information on the new program is now available online at http://bit.ly/volvopaintedparts. n

Mack Trucks Participates in Ride for Freedom Honoring Fallen Military Heroes Over Memorial Day weekend, Mack Trucks employees participated in the Rolling Thunder – Ride for Freedom Rally, to pay tribute to America’s fallen military. This year, Mack’s Ride for Freedom truck was Jack Mack, a custom-built one-of-a-kind mega-crew cab named after John “Jack” M. Mack, one of the founders of Mack Trucks. The 30th annual rally took place in Washington, D.C. Mack Lehigh Valley Operations and Mack Customer Center employees travelled from Pennsylvania by truck and motorcycle to Hagerstown, MD for a special memorial ceremony at Mack’s powertrain facility. Hagerstown employees then joined their colleagues following the ceremony as they continued to Washington, D.C. to join thousands of other Ride for Freedom participants. n

www.UTA.org July 2017 15 17th Annual Convention

16 July 2017 www.UTA.org www.UTA.org July 2017 17 UTA Industry Watch From Where We Sit

We’ve been thinking a lot about community these last few weeks. Maybe these thoughts linger from the time we spent immersing ourselves in the accomplishments of the late Jerry Nerman, who we’ve grown to admire so much, and love, too. One thing was clear throughout Jerry’s life, and that was his commitment to community, wherever he happened to be a part of one. That sense of belonging is a wealth not material or financial and one folks sometimes tend to overlook while caught up in the race to get from today to tomorrow, this week to the next. We know we do. Growing up in a military family, frequently moving from place to place, and then, as adults moving hundreds of miles away from family, we’ve always hoped to recapture that sense of belonging, and here in this last month or so, it seems we have. Yesterday we attended the wedding of the last of our children’s childhood friends. The groom was once the hair-raising daredevil who captured our son’s imagination from the first day they met. This boy has the distinction of being the only child whose mom ever got a call to come and get her offspring, and we do mean now! It happened after, “Joey,” (names have been changed to protect the innocent) rode our son’s new electric scooter off our back porch, the one we reach by climbing eight steps! With scenes of ambulances and ER visits, Joey’s mom came and the story ended well. At least for that day. This was the kid who always had an extremity in a cast or a line of stitches covered in bandages. Yet, we stuck with this friend, saw him become an Eagle Scout, and yesterday, we watched him marry his bride. And the ride we’ve watched him take has been wild, but rewarding and fun all along the way. That sounds like community to us. Earlier this week, we spent an annual happy evening at the Firefighter’s This year’s treat was that we took two of our little grandsons to the Summer Carnival. This was our 19th trip since we moved to town, and carnival for the first time. Benny rode the rides, and his baby brother every last one of them has its own special memories. This was the pointed out every “ball” in the place. Now we’ve been part of this place we first allowed our kids to go while middle-school students community long enough to see our grandchildren enjoy the same with a bunch of friends, and no adult supervision, at least no obviously exact treat their parents enjoyed. We never fail to meet up with at least visible adult supervision. They knew we were there in the crowd, but one teacher or two who knew our children and also their spouses. we promised not to interfere unless we saw trouble, and they promised When they tell us how lucky we are to have had such great kids who to make sure we knew if they needed us. This was the place where our married great kids, we smile and nod. That’s the part of community daughter once won her goldfish, took it on the Ferris wheel and that lasts no matter where life takes you on its brought it home to live 10 years in her room! That was some fish. One travels. That’s the kind of wealth we were year I wanted to buy a whisk brush from the members of the Lion’s hoping for all those years ago when we Club who always sell ice cream at the carnival. When I got to the brought our family to this little community, stand, they had no small brushes, and I expressed disappointment. and that’s the type of wealth we intend to The man asked if I planned to come back to the fairgrounds before the share with the neighbors we’ll welcome in the carnival ended, and I told him that wouldn’t be a problem. (We could years we all continue to live here. At least walk, if we wanted to.) He was a little skeptical that I’d actually do it, that’s the way it looks from where we sit. but the next evening when I arrived, there was my little broom just sitting there waiting for me. That sounds like community to us. Deb and Brad Schepp [email protected]

18 July 2017 www.UTA.org