For each of our 9 award categories, our Truck analysts looked at the most popular equipment series observed on the resale channel in 2018. These series were sorted by their relative popularity on the retail channel, and our analysts removed any series without a model currently in production. Only truck series which consist of at least 1 configuration contained in the Price Digests application (formerly known as Truck Blue Book) were considered.
Once the data had been filtered through these rules, our analysts chose 5 of the top series as finalists, with the restriction that no award category could contain more than 2 equipment series from the same manufacturer
Calculation of Residual Values
Price Digests’ residual values are calculated according to market depreciation standards. Using the Retail and Finance values contained in the Price Digests Values product, our Truck analysts examine year over year depreciation for hundreds of models. Using a proprietary algorithm (derived from Multiple Imputation by Chained Equations methodology), our Truck team is able to use the year over year depreciation calculated in Price Digests Values to estimate residual values up to 84 months into the future.
The residual values used to estimate the HRVA winners receive one additional transformation to normalize the process. Using a curated list of make/model assignments into vehicle series, residual value curves for every model in a given series are averaged using a geometric progression. This progression weighs the residual value curve of newer models in the series more heavily than older models, and adjusts these weights as the number of models included in the series increases or decreases.
For example, consider the following table, which shows two hypothetical equipment series (Series A and Series B) and the estimated 60-month residual value for all of models in the series:
|Series||Model||Residual Value||Weight||Total Value|
|Series A||Model A||96%||50%||48%|
|Series A||Model B||94%||25%||23.5%|
|Series A||Model C||92%||25%||23%|
|Series B||Model A||97%||50%||48.5%|
|Series B||Model B||96%||25%||24%|
|Series B||Model C||95%||12.5%||11.875%|
|Series B||Model D||98%||6.25%||6.125%|
|Series B||Model E||94%||6.25%||5.875%|
(Congrats to Series B, who wins this category 96.38% to Series A’s 94.5%).
The sum of the Total Value for each Series is the comparison point for the HRVA competition.