Additional emission standards, which are expected to be released in the next few years, may seriously affect the trucking industry. An article written by Chris Visser for the Opinion section of Transport Topics looks into the effect of the first set of standards on the used-truck market:
“By now, you’re well aware of President Obama’s announcement that he will direct the Environmental Protection Agency and the Department of Transportation to set the next — i.e., the post-2018 — round of medium- and heavy-truck fuel economy and emissions standards. The first round of standards was finalized in September 2011, and trucks meeting those standards are just now going into production. I’m writing this to examine the impact of the 2002-2014 standards on selling prices and provide a look at how the used-truck market could perform after 2014.
If you’ve read a market analysis or looked at used-truck values recently, you’ll know that used Class 8 pricing has reached historic levels. A major reason for this market dynamic is the high price of new trucks. In 2002, a new phrase — “emissions escalator” — entered the trucking lexicon. An emissions escalator is simply a surcharge buyers pay for engines that meet current standards.”
The price uptick in new trucks is trickling down to used trucks for sale, as a result of the new emission standards, with sellers using the emissions escalator to recoup upgrade costs. States with tighter regulations, such as California, require heavy retrofitting of diesel trucks with more air quality devices. The older models have to be phased out completely, leaving trucking businesses in need of replacements.
Some truck buyers turn to late-model low-mileage used trucks, which are cheaper than new ones, as temporary units. Others can upgrade their current trucks with better engines and quality flexible exhaust tubing from truck parts retailers like Global Parts Inc.
To ensure compliance with emission laws, truck owners should look at which devices need replacing. In older trucks, the engine is often linked to the catalytic converter, the muffler, and the exhaust port. New regulations require installing particulate filters between the engine and the muffler.
For older trucks with standard catalytic converters, the stretch of pipe between the converter and the muffler may have to be removed. A stronger particulate filter sold in the aftermarket can take its place and link it to flexible tubing; space considerations may necessitate installing a new exhaust elbow as well.
Upgrading older trucks to adhere to emission standards creates a dent in trucking investments, but the move contributes to the overall effort toward a cleaner environment. Suppliers of truck parts like Global Parts Inc. help cushion the cost by offering items for emission control.
(Source: Fuel-Economy Rules and Used-Truck Pricing, Transport Topics, 7 April 2014)