Nassau reports decline in 3Q trucking repossessions

Trucking repossessions, which have undergone a steady and continuous increase over the past year and a half, dropped by 44 percent in the latest NQI.

The Trucker News Services

11/9/2009

WESTBURY, N.Y. — Repossessions and liquidations of trucking equipment and machine tools in the third quarter of 2009 declined as compared to similar figures from 2008, according to Nassau Asset Management's NasTrac Quarterly Index (NQI).

The figures, culled from the company’s activity reports for both repossessions and orderly liquidations, also indicated a rise in repossessions for both construction and printing equipment, offering mixed news on the health the American economy as it emerges from the recent recession.

Trucking repossessions, which have undergone a steady and continuous increase over the past year and a half, dropped by 44 percent in the latest NQI. Machine tool repossessions processed by Nassau declined by 55 percent in Q3 2009, as compared to the same period in 2008.

However, other sectors continued to report increased activity in the NQI. Construction repossessions and liquidations rose by 53 percent during the quarter and printing equipment repossessions increased by 82 percent, as compared to the same total last year.

“After two very difficult quarters to start the year, there have been some scattered signs of improvement in the general economy and in some of the most battered verticals of the equipment leasing sector,” said Ed Castagna, president of Nassau Asset Management. “These numbers obviously offer a mixed message and it appears that the economy is showing some signs of life but many sectors have yet to take part in that growth.”

Because equipment values in current market are changing daily, Castagna recommends that anyone who is in the process of liquidating or remarketing assets be quick and smart in their decisions.

The 44 percent drop in truck repossessions shows this sector may have stabilized and much of the excess of equipment has been drained from the market, ending “the hysteria” of the past few quarters in a sector that has seen an extraordinary amount of activity in the past few years.

The decline in recent repossessions in the trucking sector is likely due in part to the limited production of new vehicles, Nassau noted. FTR Associates, an industry analyst firm, is forecasting a 47 percent decline in new Class 8 truck production this year.

The NQI data also reflects a mixed bag of news in trucking activity. The August 2009 Freight Transportation Services Index (TSI), which measures the month-to-month changes in freight shipments in ton-miles, rose 0.7 percent in August from its July level, a second consecutive monthly increase, according to the U.S. Department of Transportation.

NQI reports on Nassau's internal repossession and orderly liquidation activity in a given quarter compared to the same quarter the previous year or to previous quarters in the same year.

Readers should keep in mind that results must be viewed over several quarters to establish trends, Nassau added.

Nassau Asset Management has been providing full-service asset management, including asset recovery, collections, remarketing, plant liquidations, and appraisals for more than 25 years to the equipment finance industry.

Kevin Jones of The Trucker staff can be reached for comment at kevinj@thetrucker.com.

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