Prepared remarks
Good morning, everyone, and welcome to U-Haul Holding Company’s Third Quarter Fiscal 2026 Investor Conference Call. I will now hand the call over to Sebastien Reyes. Please proceed.
Good morning, and thank you for joining us today. Welcome to the U-Haul Holding Company Third Quarter 2026 Investor Call. Before we begin, I'd like to remind everyone that certain of the statements during this call, including, without limitation, statements regarding revenue, expenses, income and general growth of our business, may constitute forward-looking statements within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Certain factors could cause actual results to differ materially from those projected. For a discussion of the risks and uncertainties that may affect the company's business and future operating results, please refer to the company's public SEC filings and Form 10-Q for the quarter ended December 31, 2025, which is on file with the U.S. Securities and Exchange Commission. I'll now turn the call over to Joe Shoen, Chairman of U-Haul Holding Company.
Good morning, everyone. As mentioned in the press release, our earnings are being negatively impacted by high acquisition costs for vans and pickups from model years '23 and '24. This has significantly affected our earnings, as evidenced by increased depreciation and a shift from previously declining gains to current losses on the sale of vans and pickups that are leaving the fleet. To a lesser degree, the substantial price increases post-COVID for internal combustion engine vehicles are impacting our box trucks as well. We had been expanding our internal combustion engine fleet due to anticipated declines in the availability of ICE-powered units in the future. Currently, we find ourselves overfleeted, and the rental market is not showing significant transaction growth. We are developing a plan to open more U-Haul dealership locations, which will help utilize some of this excess fleet while generating returns.
We will still likely be overfleeted, necessitating the sale of older, higher-mileage trucks in the next 12 months. As far as I can tell, we are managing to maintain our position within the self-storage industry. For about 24 months, we have been adding units faster than we can rent them out, resulting in a surplus of available units. We are implementing initiatives aimed at improving our rental rates compared to last year, and we will see the results of these efforts as we move into summer. Our U-Box service has established a significant presence at over 700 locations in North America, enhancing our capacity and the total number of self-storage customers. We currently have over 200,000 U-Box containers in service, with more than 100,000 in the hands of customers. We have slowed down the addition of U-Box warehouses since we have a substantial presence in most markets, but we still see a need for more capacity in D.C., L.A., Boston, New York City, and the Bay Area.
Additionally, we need to expand our U-Box capacity in Vancouver Island and Edmonton in Canada. We have projects planned or underway in all these areas, and I intend to follow through with these capital expenditures. We are also heavily investing in digital tools to fulfill customer expectations as the industry leader, with most of this investment accounted for in the current period. With that, I will return the call to Jason.
Thank you, Joe. Yesterday, we announced a loss of $37 million for the third quarter, down from earnings of $67 million in the same quarter last year. This represents a loss of $0.18 per nonvoting share this quarter compared to earnings of $0.35 per nonvoting share a year ago. Our adjusted EBITDA for the moving and storage segment fell 11% to nearly $42 million for the quarter, reflecting a similar decrease in our operating cash flows. Our release and financial supplement include a reconciliation of adjusted EBITDA to GAAP earnings. Depreciation and losses from the disposal of rental units continue to significantly impact our earnings. In the third quarter, we reported a $26 million loss on the disposal of retired rental equipment, in contrast to a $4 million gain during the same quarter last year. The cargo vans we bought over the last two model years are being sold at a loss due to higher acquisition costs and declining resale values.
We have also accelerated the depreciation on the remaining units to align with this reality. Additionally, we saw increased depreciation from expanding our box truck fleet by nearly 11,000 units since December last year. The combined impacts of fleet depreciation and disposal losses resulted in a $75 million cost increase for this quarter compared to last year, equating to approximately $0.24 per nonvoting share. Over three-quarters of this negative variance is tied to our cargo van fleet. Looking ahead, we anticipate that our model year 2026 cargo van purchases will be priced around 12% lower than last year's models, and about 20% lower than two years ago. For the third quarter, our equipment rental revenues rose by $8 million, or just under 1%, largely driven by the in-town segment of our business. From December 2024 to December 2025, we added 65 new company-operated locations and saw a net increase of 365 independent dealers.
These new locations, as Joe pointed out, are intended to enhance the distribution of our larger fleet and boost transactions. Our January results were on a positive trajectory before being impacted by significant weather events across much of the country over the past week and a half. In the first nine months of this year, we spent $1.748 billion on new rental equipment, reflecting a $162 million increase over the same period last year. Over the last 12 months, our gross fleet expenditure was about $2.025 billion, and after factoring in equipment sales, this netted down to $1.331 billion, of which I estimate roughly $670 million was growth-related. Initial projections for the next fiscal year indicate a decrease in new truck purchases of over $500 million. Storage revenues increased by $18 million, or 8%, for the quarter, with average revenue per foot improving by nearly 7%. The same-store revenue per occupied foot rose 5%, indicating the cumulative effects of our rate increases.
We continue to focus on transparent pricing and avoid large introductory discounts. Our same-store occupancy decreased by 490 basis points to just over 87%. I mentioned in our last earnings call that in July, we launched a company-wide initiative to increase available units at existing facilities by addressing delinquent units. This effort did not impact revenue since we do not record storage revenue until collected; however, it did affect our reported occupancy levels. Of the nearly 5% decrease in same-store occupancy, close to 4% was due to the removal of delinquent units. Net tenant move-ins year-over-year have shown a slower pace compared to recent years but have improved compared to last year's figures when adjusted for delinquent units. In the first nine months of fiscal 2026, we invested $770 million in real estate acquisitions and developing new self-storage and U-Box warehouse space, down $444 million from the first nine months of fiscal 2025.
In the third quarter, we opened 16 new storage locations, adding about 1.5 million new net rentable square feet. Our active development pipeline now includes 106 projects, expected to yield around 5.7 million new rentable square feet. On the expense side, storage operating expenses increased by $66 million for the third quarter, and as a percentage of revenue, we experienced a setback from our previous progress. Personnel costs rose by $16 million, fleet maintenance and repair costs by $13 million, and the most significant increase came from self-insurance liability costs, which rose by $38 million, mainly due to reserve strengthening. Since March 2025, we've increased our liability by nearly $79 million. In December, our property and casualty insurance company paid U-Haul Holding Company's parent a $100 million dividend, which we are now reallocating among our subsidiaries for general corporate use.
As of December 2025, our cash and available credit from existing loan facilities in the moving and storage segment totaled $1.475 billion. I want to remind everyone that supplementary financial information is available on our homepage at investors.uhaul.com under Investor Kit. Now, I’d like to hand the call back to Jenny, with Joe, Sam Shoen, and myself here to address any questions.
Questions and answers
Your first question is from Steven Ralston from Zacks.
Considering that this is typically the second weakest quarter of the year, it appears there are some pressures in the one-way market for self-moving equipment and in the U-Box program. Could you elaborate on that? Additionally, does this suggest that the U-Box market is somewhat aligned with the one-way rental market?
I'll begin by stating that in the last conference call, I noted that over the years, we have observed that when consumers feel anxious, they tend to shorten their transactions. Rather than relocating to a new city like Denver, they opt to move to a suburb within their current area. They still have various reasons for moving, which reflects a constant underlying demand, but the distances are typically shorter. This can sometimes convert a one-way transaction into a local one. Regarding U-Box, we have experienced our most significant success with long-distance transactions. Therefore, as U-Box relates to U-Haul, it will reflect similar trends, potentially showing a more pronounced change as a portion of our business.
Right. Yes, Steven, that's a great question. I think this is getting to kind of what you're asking. U-Box operates in almost primarily in what U-Move considers the long zones. So for rental trucks, what might be 20% of our one-way business in the long zones, for U-Box might be 80%. And so I think the question you asked was does U-Box track the one-way moving market, certainly in that way it does. And then, of course, as we have distribution as we're using rate to control distribution, now we're pricing U-Haul trucks in a certain way and our customers are seeing that and getting to incorporate that into their choice. So I think the short answer to your question is yes.
You've talked a lot about the depreciation line, and I'm a bit confused. Could you clarify it? Depreciation has increased significantly, but it actually decreased from the second fiscal quarter to the third fiscal quarter. What is happening in terms of accounting?
So this is Jason. A couple of things going on. First, the depreciation of the box truck fleet is a dynamic process where each time a truck reaches its 1-year anniversary, the depreciation rate decreases. In the first year after we purchase a box truck, we write off 16% of the cost. In the second year, it's 13%, and it continues to decrease from there. If we take no action, the depreciation on the box truck fleet will gradually keep stepping down. The second part of that is concerning our pickup and cargo van fleet, which is smaller...
It's a shorter life asset, right?
Yes, that's correct. We maintain it for a shorter duration, and we're adjusting the depreciation rates quarterly based on what we observe in the resale market. Having nearly completed the sale of the model year '23 units, we are now transitioning to the '24 units. Therefore, that depreciation figure is being revised from quarter to quarter.
Your next question is from Steven Ramsey from Thompson Research Group.
Maybe to start with, what did you think about from the high level for your business? You've continued to invest in growth in all areas of the business in the time of subdued activity. If you think about moving competitors against you in the traditional moving and U-Box space, have you seen capacity reductions from peers, or another angle maybe is how you're expanding in the dealer space to position you to perform well now and perform much better on the other side of this?
I'll answer that. Yes, regarding both fleet and locations, the numbers are not difficult to assess. While I can't provide an exact figure for how many outlets Penske or Budget operate, we have various indicators from industry sources that lead us to believe both are reducing their fleets and outlets. If there is an upturn, or if we improve our understanding and satisfaction of customer needs, we will be well positioned to meet that demand. I believe we've previously misunderstood some of our customers' needs, and if we address these shortcomings, we can expect more transactions from them, resulting in more outlets as well, which is part of our overall strategy. For reference, Budget has around 3,000 outlets and Penske has about 3,500, while we have over 24,000, so we certainly lead in terms of customer accessibility, which is key to our strategy. It's a matter of deciding how far to push it.
There isn’t a straightforward algorithm for this; perhaps one exists, but finding that solution isn't as simple as solving a math problem. Additionally, our fleet isn't uniform; it comprises various sizes and ages of vehicles, which are crucial for managing our operations. We've been trying to catch up with significant supply chain disruptions caused by COVID and government policies on electrification. Fixing these issues will take time. We can address the pickup and van fleets in roughly 24 months due to their rotation, but for our box truck fleet, it's an eight-year process at least. Sometimes, we end up purchasing more trucks than necessary because we need specific sizes, or certain trucks become available that weren't before. There are numerous adjustments within those larger numbers. If we rewind to 2016, we had a well-tuned fleet, which reflected positively in our profitability. As we rebalance our fleet, I wish I could provide a more precise timeline for when this will be achieved, but I can't. As you know, I've expressed concerns about the administration's push for electrification, which has led manufacturers to raise prices significantly—by 30% to 50%—and limit vehicle allocations.
We've been unable to obtain the models and quantities we wanted, forcing us to accept what was produced by their supply chain. This disruption affects the age and size of our trucks, and we are actively working to resolve these issues. This year, we purchased what some might consider an unreasonable number of vehicles, but if you look closer, you'll see we're trying to restore that balance. In a few years, we aim to have the right mix and age of vehicles to meet market demands. We're conscious of this, though it ultimately relies on judgment rather than guarantees. I'm hopeful that the administration will shift its focus away from electrification, as evidenced by significant write-offs from major manufacturers. Companies like GM and Ford have faced substantial disruptions that ripple down to businesses like ours. However, I believe manufacturers will eventually adapt and deliver the vehicle mix that customers desire, leading to positive responses from the market. I hope this answers your question, though it may have included more detail than you needed.
Okay. That's helpful perspective. I appreciate that. I wanted to think about the expense management side of things? I know it's been a focus for you. Do you think this needs to be a more intensified effort over the next 6 to 12 months? Or would you say the structure is actually in a good place, but it's more waiting on volume to come back?
I've been working through our budget system, trying to get the right responses from different parts of the organization. I expect to see some results this year and even more next year. Repair costs are significant, approaching $800 million annually, but we can forecast them quite well based on our models and metrics. We're managing repair costs somewhat effectively. However, personnel costs are a concern. Many organizations, including ours, are facing rising living costs for our workforce, and I anticipate these will continue to increase steadily over the next 2 to 3 years. Our challenge is to keep up with those costs while ensuring we have enough revenue to support our staffing levels to keep our stores open at desired hours. We may need to adjust store hours in the coming year as current revenue levels may not be sufficient to cover wages for the hours we want to be open. Every day we open around 2,400 stores, which requires adequate staffing, and we must pay these workers a living wage.
There will be challenges in that area. In the West Coast, states like California, Oregon, and Washington have increased minimum wages, affecting both hourly and salaried employees, which will impact the profitability of many of our stores. While we will pay our employees, we also need to enhance productivity. Our self-storage and U-Box services have provided some relief in certain locations, though some sites have limited capacity due to their size. For example, in Los Angeles, many locations are just slightly over half an acre, leaving little room for expansion. We're aware of these pressures and are actively working to address them.
Okay. That's helpful. And then last one for me. You've talked some about U-Box in the major markets that you are building out. Can you clarify if construction is going on in those markets for warehouse capacity? And then secondly, can you talk about U-Box usage both moving and storage in large metros that you already have established warehouse presence? Trying to think about the potential upside in the big cities once it's built out.
I'll take the lead on that question and let Sam follow up. In the metropolitan areas I mentioned, we at least own property. We are at various stages between land use and construction at these locations. Each situation is quite complex. For example, in Washington D.C., we have had the steel structure ready for two years, but due to COVID and city bureaucracies, we've faced delays. We initially expected to break ground two years ago, and while we ordered and received the building, we still haven't started construction. It's not for lack of effort; the process is just quite intricate. In all the metropolitan areas I mentioned, we own the property. Regarding Vancouver Island, it's clear that without significant warehouse capacity, our U-Box business cannot succeed. Therefore, having proper warehouse capacity there is crucial. In the rest of Canada, we've made good progress from the Maritime provinces, through Ottawa, down to Montreal, and throughout the Greater Ontario area, covering the region between Toronto and Detroit, where we have a solid footprint. I believe our business will thrive as a result. Sam?
Sure, I'll provide some additional insights. We are particularly enthusiastic about U-Box in metropolitan areas because Joe designed our product and strategy specifically to address space constraints found in these regions. For instance, our container size can easily fit into an apartment parking spot, unlike many of our competitors. In tough metro environments, there are often regulations that dictate where containers can be placed, requiring permits or prohibiting placement on the street altogether. Our delivery method allows the container to be equipped with a trailer and a license plate, enabling it to be parked in any legal spot. These features set our product apart from the competition and were intentionally developed. We are optimistic that these advantages will continue to yield strong results in urban markets, particularly since there is a growing demand for smaller containers in these areas. Thus, providing the right-sized product to our customers positions us well for success.
Steven, this is Jason. I just want to make sure that there isn't any misunderstanding. In these markets, our customers already have access to the U-Box product. We're just looking to improve their access to it. It's not that we aren't in those markets.
Your next question is from Jeff Kauffman from Vertical Research Partners.
I just had a question more for Jason. You talked about we're almost through the 2023 cargo van cohort and starting to work on the '24s. Can you give us an idea of how many vehicles we have left to kind of get caught up to the current market and maybe the differential between your average acquisition costs and where you're depreciating the '24s versus what that spread looks like for the '23s?
Sure. I can provide some overall figures. For the 2024 model year, we have around 6,000 units remaining, which were more expensive than the 2023 models. Additionally, we have nearly 19,000 of the 2025 models that are approximately $3,000 less expensive than the 2024s. We are in the process of phasing out the 2024s, and we have been applying increased depreciation to those. This approach is part of the strategy to address earlier questions regarding depreciation increases, as we attempt to minimize losses before selling these models. We'll evaluate our success in this effort over the next year.
Okay. But do you think that, regardless, it will eventually be reflected, either through depreciation or loss on sale? Do you feel we've accurately assessed the mark-to-market for the '24 model years at this time, or will there still be some delayed adjustments for loss on sale?
I think it would be fair to expect a loss on sale for those units. I don't know if we're fully there yet.
Let me address your question. When you make an estimate of what you expect to sell something for, you set up your financials accordingly. We've had to adjust this because, as the market has changed, our initial estimates have proven to be inaccurate. This seems to stem from automakers moving away from electrification and reorganizing their supply chains, resulting in them selling new vehicles for less than they did last year while still maintaining their profit margins. This situation can negatively impact resale values. In the past 15 years, we haven’t seen a market where new prices are consistently lower than old prices, so we've clearly misestimated this trend. We recognized the issue about 1 to 1.5 years ago and began taking action, believing we were emerging from it. However, once again, we faced another wave of challenges. While we are acquiring vehicles at lower prices, it may mean that our new trucks will sell for less than we anticipated at retail or wholesale.
Our team is well aware of the situation, and we are aiming to adjust depreciation carefully to remain neutral at sale. The trouble with this process is that by the time we sell a vehicle, the original purchase price is often forgotten. We need to endure the cost on a monthly basis, which also creates challenges for our marketing teams, who incur depreciation as part of their responsibilities. This complicates accountability for recouping sale losses since the budget did not accurately reflect these estimates. I'm hopeful we will get it right, but this entire situation has introduced new insights that many didn't fully grasp. I tend to have a cautious perspective and push my team hard. While they are focused on selling their way out of problems, it’s clear that declining prices over the last two years indicate it won’t be that easy. We need to respond to the market collaboratively. Though these estimates aren’t precise, they reflect an educated guess about future sales.
Other industry players are also trying to navigate this, and I believe we might have reached the bottom of this trend. However, if GMC lowers their prices next year to improve margins, we could face similar challenges. They've experienced issues attempting to meet external pressures that were based on misunderstandings but affected their operations. This hasn’t hurt us as severely, but it is still impacting us, and we’ll work through it. I take pride in having our fleet valued on our books lower than its actual worth, as being overvalued can lead to difficult situations. We've misjudged our pickup and van fleet values for two consecutive years, and I hope we have it right this time, but only time will tell. It's crucial that we manage our depreciation carefully without going to extremes, as being too high or too low can hinder our rental teams’ ability to meet their goals. Overall, the company has overestimated resale values for two years running. Although it balances out eventually, it can affect motivation in the meantime, and I must address that.
Your next question is from Jamie Wilen from Wilen Management.
Joe, you've always mentioned that fleet utilization was your prime objective in managing the business. How did you arrive at only reducing the fleet expenditures in the coming year by $0.5 billion and as you look forward, are you going to spend $0.5 billion less in future years as well?
I'll begin by discussing the fiscal year we just completed, which we refer to as fiscal '26. During this year, we saw a significant increase in fleet expenses, aimed at rebalancing our fleet. If we don't purchase new trucks, we face the risk of not having sufficient vehicles in four years, leading to imbalances across our fleet, which in turn affects our future purchasing decisions. In the year just concluded, we added approximately 10,000 10-foot trucks, exceeding our replacement needs. Moving forward, we've drastically reduced our planned purchases. For our 20-foot trucks, we currently have a significant number that are 8 to 10 years old. While our overall fleet size is acceptable, the age mix is problematic, as older trucks do not perform as well as newer ones. Thus, I'm planning to acquire a larger number of these trucks than simply as replacements because we need to balance the age distribution.
Ideally, we would be able to calculate the lifespan of each truck, divide that by the fleet size, and make uniform fleet purchases every year. Unfortunately, availability has been an issue, especially exacerbated by supply chain disruptions over the past five years. Due to allocation issues, we've had to make substantial purchases in instances where trucks were offered to us, which put us in a precarious position. Going forward, we intend to reduce these expenditures and assess our sales capabilities because we are facing challenges not only in purchasing but also in selling. For instance, with my 20-foot trucks, we have a potential 12,000 units that we cannot realistically sell all at once; digesting that many in the resale market might take three years or longer. If we don't buy for three years, we will be left with similar challenges down the road. Therefore, I’m planning to make modest purchases that could help stimulate sales and facilitate finding a balance. We're currently exploring how many of these trucks we can successfully place in the resale market and should plan to purchase at least that number this year to avoid future supply chain issues.
On the self-storage side, as far as capacity utilization there, is there any thought of slowing the pace of development to a more modest level?
It has slowed down significantly. I think Jason estimates it to be down $400 million. The numbers are somewhat weak. However, we have intentionally slowed our progress. Constructing a new self-storage facility typically takes about three years. So if I decide to slow it down, the effects won't be noticeable until three years from now. On the other hand, if we want to accelerate the process, the impact will also not be seen for another three years. Therefore, we need to be careful both ways. We have indeed decided to slow it down while still pursuing what I view as strategic projects. For instance, the U-Box warehouses are, in my opinion, strategic and it would be unwise not to develop them. However, it's going to require a substantial financial commitment, which I'm monitoring closely. In terms of self-storage, we are being more opportunistic as we move forward. We approach situations where we feel we have an advantage over others or when we identify semi-distressed assets.
Recently, we acquired a location in Olive Branch, Mississippi. While it may not seem significant to you, we already owned a store there and have now purchased a second one. We paid significantly less than three-quarters of the construction cost for it. I believe Olive Branch will perform well over the next decade, even though it might not be on your radar. This decision was based on an opportunistic assessment, and we are proceeding with it.
You all have done a great job of building value, but haven't created as much value for shareholders. If I were on the Board, pardon me?
I'm with you on that.
If I were a Board member, here's what I would suggest to you to help crystallize a bit more of that value. We all know how undervalued self-storage is relative to the rest of the world. And we'd like to help the investment community as well as analysts recognize a bit of that. What I would suggest us doing is selling a territory of well-occupied facilities that don't have U-Box storage in there because I don't want to eliminate the competitive advantage we have with the rest of the world in U-Box. But I would take an area where we have stabilized occupancies over 80% like a Tennessee or New Jersey and hopefully, no U-Box storage or not much. And I would want to sell that to one of the publicly held REITs, which could crystallize value for how much we have value if we have created there and recycle the proceeds. If we get $1 billion or $2 billion, use half of them to buy back stock, the rest to pay down debt. We'll build new facilities. But it would help crystallize what we built and hopefully not impact the growth of the core business there. What do you think of that?
I understand the math behind it, but I'm not entirely sold on the proposal. Each opportunity I pursue makes me cautious about selling. If the market improves, we might regret selling. It's worth considering, and I'll discuss it further with Jason, who has a good grasp of the numbers. I'm also ambivalent about the stock buyback. We implemented a stock dividend and other strategies to attract analysts and enhance liquidity, but we saw minimal results. No one on my team is a stock expert, and I was disappointed with the market's reaction. We need to demonstrate value, and one way to do that is by achieving 90% occupancy in our stores. Currently, we're around 80% effective occupancy, which varies by store, but it's a reasonable estimate. This number has been affected each time I open a new store. I believe the market is much larger but is currently being poorly served. I want to convey to customers that we're not part of that mistreatment.
Many new players have entered the industry, often viewing storage as an easy profit, whereas I see it as something to nurture. They tend to be tough on customers, but I believe we can excel in customer service, and there are enough people in the market who recognize that storage facilities aren't just about storage. I think we've been outperforming our peers, particularly large REITs, by maintaining rates and growing our customer base. While I don't have insider access to their numbers, it seems they're struggling to keep move-in rates on par with move-out rates, while we maintain that differential. I'm optimistic about filling more units, but I think we're close to capacity, with about 220,000 to 230,000 empty units.
If you include the managed portfolio, so U-Haul-branded stores were about 290,000 rooms available.
Okay. So all of those are depending on either a liability or an opportunity. So as a shareholder, you're probably seeing a little bit as a liability because you're paying for them and getting nothing for it. I think we're going to see significant progress in filling those rooms and that's how I have my teams wound up. At the same time that we've increased successfully, we've increased total customers every year in conventional self-storage. We've done the same thing. We've introduced something like 100,000 storage customers in the U-Box. So from the point of view of operating a facility, that manager is looking at a total storage customer base. So I'm not disgusted with our performance. But I think our performance has to be better because we've invested the money. But I think we're showing we're resonating with the customer as much or better than anybody else in the business.
I believe you have 2 customers here. One is the person who rents your storage facilities and truck rentals and the other customer are investors. And investors would love to see you harvest some of the value you've created where you've turned $1 into $4, but we can't see it. Whatever you can do in that respect would be a good thing for...
I got it...
And your next question is from Steven Ralston from Zacks.
I just want to circle back around and tap Joe's experience and get a historical perspective. You've pointed out that you're in a very unique period with the emphasis on EV vehicles and the demand that came through COVID. When you think about the situation in your past, does it remind you of any time in the past where you resolved the situation and how it happened and you use that as like key markers in managing the company?
In general, yes. In fleet, we've always had the ability to purchase all the fleet vehicles we could afford. Our main issue until recently was being capital constrained. Then COVID and the post-COVID situation changed everything, and now we can acquire what we need. We are not faced with many constraints in that regard, but we are regularly working on it. If I could go back and do things differently after COVID, I would have advised them to hold onto their trucks when they imposed allocations. Next time, I would tell them to keep their trucks, and if prices rise, they can hold onto them because I believe I can manage for a few years, and my customers would support me. I think I was too eager to purchase trucks since we had a strong balance in 2016, and I wanted to return to that quickly. I didn't hold my ground enough when they proposed significant price increases, which I felt were unsustainable.
There was a lot of talk, like Mary Barra's comment about GM stopping internal combustion engine production after 2037, which is worrisome from my perspective since alternatives don't always perform as needed. I also noticed that although Ford didn't make such an expansive statement, they were operating as if they were unwilling to continue production by eliminating the second shift at one of their truck plants, which we had benefited from for over a decade. So when they removed that second shift, I started to question where trucks would come from. I believe we would have been better off allowing our fleet to age at a pace that suited us and at a cost that worked for us without having to absorb excess costs. However, that's not the reality, and we need to find a way to work through it without affecting future fleet decisions adversely. This has resulted in us purchasing more trucks than an analyst might expect, but given the truck's age and future implications, my experience tells me it’s prudent to acquire some.
While I lack specific market markers for this, I do have substantial experience in self-storage, which I believe offers good investment opportunities. However, the pace of return is slow, which may not attract investor interest, although I am an investor as well. We can analyze market penetration across various segments, and the demand for storage has surpassed all expectations, as evidenced by the major companies in the field. No one fully anticipated the level of demand, which is still being met in an inconsistent manner. Identifying and filling those gaps poses a significant opportunity for those who can manage it.
There are no further questions at this time. I will now turn the call back over to Sebastien Reyes for closing remarks.
Thanks, Jenny. I have one question that I wanted to post here that came in during the call. U-Haul's profit margins, excluding depreciation have been in constant decline for the last decade. Please explain why margins have been so persistently weak since 2016, and please explain your plan to restore the profitability of this great company.
Well, this is Jason. I'll take that question. In 2016, we reached the peak of our EBITDA margin. Historically, our earnings have been somewhat cyclical, largely influenced by our organizational expansion over specific periods. For context, our EBITDA margin was around 35% to 36% in 2016, while the previous ten years averaged 25%. Since 2016, our average EBITDA margin has been 33%, indicating a structural improvement in how the organization is managed. We have included a slide illustrating this trend of improving EBITDA margins, which aligns with our growth in the self-storage and U-Box markets. Since fiscal year 2016, we have experienced a mix of good and bad years. During the COVID years, we saw a rebound back to the mid-30% margin range, but that included revenue recognition without corresponding expense recognition. For instance, we incurred repair and maintenance costs during the work-from-home phase when revenues surged, but current accounting rules do not allow us to anticipate maintenance costs based on truck utilization.
We recognized the revenue from those miles while later dealing with the related repair expenses. Additionally, our former auditors did not agree with how we reserved for self-insurance liabilities, leading to an $88 million reduction in those reserves to finalize their opinion. Looking back, it appears we would have been better off keeping those reserves, which could have served as a buffer. With increased transactions during COVID, the rate of incidents also rose, and we are now seeing those past incidents developing into more significant issues than initially anticipated. If we had a typical quarter for U-Move, with 4% revenue growth and no need to strengthen reserves, we would be looking at a healthier average EBITDA margin. I'm cautious about the notion that there are structural issues with our operations related to expenses; it seems more related to revenue fluctuations and cyclical factors.
We are in an unprecedented growth cycle, significantly expanding our fleet and self-storage capabilities, and I believe we have managed to maintain our EBITDA margins reasonably well through this transition. A decent EBITDA margin for us across a 12-month span typically falls in the low 30% range, and we are currently underperforming in that area this year.
Well, thanks again, everyone, for your participation. We look forward to speaking with you again after we report our year-end results in May. Thanks.
Thank you. Ladies and gentlemen, the conference has now ended. Thank you all for joining you. You may all disconnect your lines.