Equipment auction volume jumps as supply improves
LAS VEGAS — Equipment auction volume is increasing amid rising inventory levels and seasonality trends.
“Auctions are growing; you’re going to see a lot more equipment rolling through auction,” said Mitch Helman, sales manager at AuctionTime, EquipmentFacts and HiBid — subsidiaries of equipment sales magazine publisher Sandhills Global.
“We’re coming at the end of this pandemic, and inventory levels were as low as they’ve ever been because of the supply chain disruption,” Helman told Equipment Finance News. “Inventory levels are starting to come back, so there’s more equipment coming into the marketplace, which ultimately will lead to more equipment potentially rolling through auctions.”
Rising inventories in construction and trucks are leading to more movement in the auction marketplace, Helman said.
U.S. used heavy-duty construction equipment inventory increased 3.5% month over month in February, but was down 9.4% year over year, while medium-duty construction equipment inventory levels rose 9.9% MoM and 18.4% YoY, according to the Sandhills Equipment Value Index.
Meanwhile, heavy-duty trucks saw an inventory increase of 4.8% MoM and 38.1% YoY as medium-duty truck inventory levels increased 7.1% from January to February and jumped 18.5% YoY, according to the index.
Demand good for business
“Inventory levels are going to continue to climb across the board between all construction and trucks, so there’s going to be more inventory coming in the market, which is good for us,” Helman said. “More inventory means more equipment needs to be sold, so it’s going to be a good year for us [and] the overall industry.”
The demand and movement of construction equipment, specifically, bodes well for the equipment industry’s immediate future, Helman said.
“Construction is going to be okay; there’s a lot of work out there and it’s busy,” he said. “That’s not going to change in the coming months and in the coming years.”
Seasonality also is returning to the equipment auction marketplace, likely increasing the amount of money that will run through auction houses this spring, Helman said.
“There are seasonal swings; you’ve got your biggest time of the year in December,” he said. “There’s a spring bubble right now, so you’re seeing a lot of equipment in February, March and April that rolls through. There’s going to be hundreds of millions of dollars transacted on the auctions.”