By on August 12, 2008

And the Lot Queen of the Month award goes to....The inventory levels and average sales per franchise (SPF) numbers as of August first are out and almost everyone looks good on the car side of the inventory sheet. Trucks are a whole ‘nother matter, though.  Dealers are doing whatever they have to– including half price sales– to move body-on-frame trucks but inventory is still piling up. Just how bad is it? Well, let's take a look… 

Chrysler has fewer vehicles sitting around than at the same time last year, but sales are so bad that "abysmal" would be an optimistic appraisal. In July, Chrysler sold only seven vehicles per franchise (SPF). Jeep was marginally better with eight SPF, while Dodge sold 20 vehicles per franchise. High inventory numbers reflect those low sales. Jeep dealers have to contend with a 168-day supply of Liberty, a 156-day stock of Wrangler and 118 days' worth of both Compass and Grand Cherokee.

Dodge is even worse. While their passenger car inventories are at manageable levels, they have enough Rams for 111 days, enough Journeys for 132 days, enough Nitros for 224 days and– get this– enough Durangos to last 354 days. Chrysler franchisees don't have a lot of room on their lots, either. The 300 inventory represents 116 days of sales, and they have enough Town & Countrys and Aspens to last 111 and 158 days respectively.

Ford dealers are faring better, moving 37 units each. Lincoln and Mercury peddlers didn't fare so well, selling six and four vehicles each respectively. FoMoCo inventories looked pretty good on the car side, with only the MKZ and Milan into three digits (102 days for both). Ford's car-based CUVs are doing well– except for the Flex's 134-day supply. Dealer stock of body-on-frame trucks– F-Series (107 days), Explorer (111 days) and Expedition (125 days)– are piling up. The stalwart Ranger is looking good, with a mere 68 day supply.

Saturn leads the GM dealer hit parade with 41 average sales per franchise, followed not too closely by Chevy dealers with 34 sales each. After that, GM's SPF stats drop it like its hot. GMC franchisees managed to sell just 12 trucks each. Hummer dealers somehow got 11 units each out the door. Pontiac dealers averaged 10 vehicles. Cadillac and Saab dealers tallied nine sales each, while Buickmongers only eked-out three sales apiece in July. 

With a few exceptions like the LaCrosse (121 days), Lucerne (125 days), and Corvette (145 days), GM's passenger car inventory looks pretty good. But, like everyone else, traditional trucks are available in abundance. The three Escalade models average 152 days. Every Chevy truck with exception of Tahoe is in the triple-digit club, with Avalanche leading the parade at 156 days. The Tahoe barely escaped membership with a 98-day supply on the lots. All of the GMC SUVs and pickups are well over the hundred-day mark. 

The Big 2.8 aren't the only ones sitting on oodles of trucks. Honda dealers have a 111-day supply of Pilots and a 127-day supply of Ridgelines to unload. Acura dealers have a similar excess of MDX (120 days) and RDX (113 days). On the positive side, Honda dealers managed to sell 81 cars and 42 trucks per franchise, while Acura dealers moved 30 cars and 18 trucks each.

For some reason, Toyota won't break their inventory down by model. All we know is that Toyota/Scion dealers started the month with a 29-day supply of cars and a 99-day supply of trucks, while Lexus dealerships had 42 days' worth of cars and enough trucks for 60 days. Toyota placed first in sales per franchise, moving 94 cars and 49 trucks each in July. Even with the economic downturn, Lexus dealers averaged 60 cars and 40 trucks each.

Nissan follows the same inventory trend as the rest of the industry. The only Nissan cars exceeding the ideal 60-day inventory level are the Maxima (62 days) and 350Z (182 days). The inventory report also shows 600 GT-R's in the U.S…. somewhere. Trucks look surprisingly good, too, except for Murano (134 days), Armada (143 days) and Titan (down from 489 to 144– does anyone else smell massive fleet sales?). Nissan's 47 cars and 34 trucks SPF placed it fourth overall, behind Toyota, Honda and Lexus.

Other manufactures show similar numbers. Mazda has a 46-day supply of cars and a 108-day supply of trucks. Mitsubishi follows suit, with 65/125-day averages.  Hyundai and Kia dealers are sitting on a 42-day supply of cars and a 61-day supply of trucks. Hyundai dealers sold an average of 52 vehicles each, while Kia dealers pushed 43 units out the door in July. Mazda moved 33 vehicles per franchise while Mitsubishi dealers managed 19 sales each.

You can expect these inventory numbers to fluctuate quite a bit over the next few months, as manufacturers continue to adjust production mixes to cut back on trucks and increase cars. Sales per dealership seem to remain fairly constant, moving maybe one or two places in either direction from month to month. As always, we'll keep an eye on them and let you know what happens.

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36 Comments on “Taking Stock: Cars Rule and Trucks Drool in July’s Inventory...”


  • avatar
    Pch101

    I think that the big ugly lurking problem for Detroit is that rental fleet sales don’t make for a good dumping ground for unwanted trucks.

    If you build a crappy midsized sedan, the rental agencies will come, so there is a place to get rid of the orphans. But the rental companies don’t bother much with trucks.

    Truck fleet sales typically go to corporate users, such as construction companies, but obviously, those guys are not in fleet mode at the moment. They also often go to government agencies, but they are also cash strapped at the moment, and probably aren’t eager to add thirsty trucks to their deficits.

    The only thing left is retail. Because truck leasing is pretty much dead, that means that they need to be sold. With their options so limited, you know what that means — incentives are going to stay high for awhile, and they could well increase.

  • avatar
    Scottie

    I was at the Dodge Dealership a few days ago, they have a handful of “new” 2007 Dakota’s still on the lot.

    Too bad they only have about 10K advertised off MSRP, making them around 20K.

  • avatar
    86er

    These figures are U.S. market only right?

  • avatar
    gamper

    Really goes to show that Big 3 need to cut a substantial number of dealerships still. I am not really sure how you run a franchise selling in the single digits every month.

  • avatar
    Pch101

    I am not really sure how you run a franchise selling in the single digits every month.

    They have to sell a lot of used cars, have an active service department, and make sure that the finance guys pack on a lot of crap extras to as many sales as possible.

    Which means that the salespeople and their managers spend more time peddling whatever they can, however they can, than they do working with the manufacturer to build the brand. Obviously, that’s not good for either side over the long run.

  • avatar
    NickR

    The Durango could, at this rate, become an automotive verb. Every time a dealer gets an utterly miserable model that will sit on their lot forever, they can say ‘Oh God, we just go Durangoed’ or ‘We’ll have to offer a good deal on that or we are going to get Durangoed.’

  • avatar
    psarhjinian

    …Corvette (145 days)…

    Well, that explains the at-the-time-unexplainable Vette incentives noted earlier this month.

  • avatar

    86er
    These figures are U.S. market only right?

    Yes

    gamper

    Really goes to show that Big 3 need to cut a substantial number of dealerships still. I am not really sure how you run a franchise selling in the single digits every month.

    Fortunately, at least for the sales staff, most domestic dealerships cover more than one brand’s franchise. For example, if you combine the average SPF for GMC, Pontiac and Buick into one dealership, you get an average of 25 vehicles sold. Likewise, a Chrysler/Dodge/Jeep combo would average 35 sales.

    And, like PCH101 noted, the used car and service/parts departments bring in the bulk of the business for a lot of new car dealerships nowadays.

  • avatar
    Axel

    Saturn leads the GM dealer hit parade with 41 average sales per franchise

    Wait… what?!

    If you count the Malibu and Aura as a single model, it must be totally owning the competition.

  • avatar
    ZoomZoom

    Interesting article. I wonder how do they figure how many days supply they have when demand is constantly fluctuating (or in the case of trucks, constantly decreasing)?

    I could say that with two half-gallon tubs, I have a 7-day supply of ice cream in my freezer, given my normal rate of consumption. But how do I know that if suddenly tonight at the last minute, I feel like inviting a couple of ice-cream-loving friends over?

    On an unrelated topic, it has occurred to me that we haven’t heard from Robert since before the weekend.

    Hopefully everything is okay and he’s just on vacation. Or maybe deep undercover working on the next deathwatch article.

  • avatar
    tirving

    I waited for this. I almost bought an 07 Tundra Double Cab SR5 5.7 last year, but was $500 apart from the dealer (I was at $26500). I expected the economy to go south (sub-prime, etc.), gas to go north (China, India, Venezuela…) and truck sales to suffer. Since gas is not much of a factor to me (6 mile commute), this was an opportunity, not a problem. Got the truck for $10K off sticker ($20740), nicely equipped. I now drive a truck. I am a man! Life is beautiful.

    It’s possible that prices will drop further, but I decided to get it now because with inventory declining, I might not have gotten what I wanted.

    Also, I checked Chevy just for the heck of it. They are far less flexible!

  • avatar
    Axel

    tirving:
    Got the truck for $10K off sticker ($20740), nicely equipped. I now drive a truck. I am a man! Life is beautiful.

    I’m guessing you live within 5 miles of work, correct? :-)

  • avatar
    Bunter1

    GM should send 3rd parties around to make offers on Buick dealerships. They could get them for a song (as opposed to what GM would have to pay upfront) and pass the name on to the Chinese for a song and dance.
    One down.

    BTW-I didn’t see an estimate of Honda’s car inventory-or isn’t there one?

    Bunter

  • avatar
    volvo

    I think that the big ugly lurking problem for Detroit is that rental fleet sales don’t make for a good dumping ground for unwanted trucks.

    I find it interesting that the car rental prices reflect this inversion. Recently reserved an airport rental for a few days. Just as an example Chevy Aveo $39/day. Ford Explorer or other mid-sized SUV $17/day. Since I won’t be driving 100s of miles/day I took the Explorer. I didn’t run the numbers but I think you would need to drive several hundred miles per day to make the prices even out (and then you would still be driving a subcompact). Rentals are where the real SUV bargains are right now. And you can turn the vehicle back in after just a week or two.

  • avatar
    adam0331

    Got the truck for $10K off sticker

    I feel really bad for the private sellers trying to unload their used trucks/SUV’s at prices that match the dealer for new.

  • avatar
    adam0331

    Recently reserved an airport rental for a few days. Just as an example Chevy Aveo $39/day. Ford Explorer or other mid-sized SUV $17/day.

    Just last week the National car rental lot at the Austin, TX airport had a Silverado with a huge sign that read “you’ll look cool driving this.”

  • avatar

    Axel:

    I’m guessing you live within 5 miles of work, correct? :-)

    Since he said in the sentence right before the part you cut and pasted that his commute is 6 miles… :)

    I just bought a Tundra too. Lots of compromises with trucks, had it down to the Tundra vs Chevy and the Tundra won on price and engine. But $20K for a near $30K sticker? Hell yeah, now I can haul my race car rather than drive the miserable thing.

  • avatar

    when is ttac going to start its tomoco death watch? the signs are there if you know what to look for …

  • avatar

    what about VW? BMW? M-B? Audi?

  • avatar
    RedStapler

    The Chrysler-Jeep store here in Reno has roughly 40 Liberties sitting in storage right in the back 40 at another Lithia Dealer.

    All of the Lithia stores have been putting more emphasis on used cars for some time now.

  • avatar
    toxicroach

    People complain about GM deathwatch taking to long. Starting a Toyota deathwatch now is just too early. Everything dies, but Toyota has a good 50 years on it even if they hired the Japanese equivalent of Waggoner and Lutz to run the company tomorrow.

  • avatar
    P71_CrownVic

    Good job Ford…yet another failure on the D3 platform.

    I wonder when they will get their BILLION dollar investment back from retooling Oakville.

    Too bad they just didn’t advertise the NEW FOR 2008 Taurus X…

  • avatar
    jerry weber

    If the numbers are right for GM Ford & chrysler dealers, it won’t be long before many have to throw in the towel.It was said that a good strategy to not spend billions to reduce the amount of dealers is to let them burn out with stale glued to the tarmac products. Whether the mfgs. planned it or not, it will come down to this. The bank carrying charges will end this venture before the mfg. As to how these dealers last at all, it is used sales and service that keep them going. Also, many dealers have profitable foreign stores that generate cash to throw into the domestic stores. However, with another new model year comes new parts, tools, sales lit, and of course more inventory. Imagaine throwing all your remaining buick car brochures away as the new identical ones arrive for 2009. Yes, some of these dealers will have to bale just to cut the losses.

  • avatar
    Detroit-Iron

    This may have been an article before but I’m too lazy to look for it. Could the experts at TTAC enlighten me on how a dealership actually makes money? The process is mystifying. Also I’d be interested to know how much they make from the manufacturer on warranty service and recalls vs. customers who pay out of pocket.

  • avatar
    Verbal

    Why doesn’t the Durango photo have a snarky caption?

  • avatar
    Bunter1

    bloodnok-Re:Toyota Deathwatch.

    Frank Williams put out some market share charts this month that may clear this up for you.
    Also, take a look at their scores in the JDP VDS.
    They have had some quality stumbles but viewing all the data from JDP, CR and True Delta leaves the impression that those are anomolies and only Honda can run with them in that arena right now.

    I like very few of their products but I think they can say with Twain “Rumors of my death have been greatly overstated”.

    Just sayin’.

    Bunter

  • avatar
    Scottie

    Plus Toyota actually seems to make changes when they realize they made a bad move, rather than ignore it or blame it on something else

  • avatar
    phil

    like cretinx, i’m also curious about the Germans

    what about VW? BMW? M-B? Audi?

    last i heard MB was kicking butt

  • avatar
    Geotpf

    bloodnok :
    August 12th, 2008 at 1:49 pm

    when is ttac going to start its tomoco death watch? the signs are there if you know what to look for …

    When their net profit drops below 1 trillion yen a year (10 billion US dollars). Their profit the last four years has been above that level each year, and indications are that that will continue. If you have Scrooge McDuck’s money pit, you aren’t on anybody’s Death Watch.

  • avatar
    Geotpf

    Detroit-Iron :
    August 12th, 2008 at 3:44 pm

    This may have been an article before but I’m too lazy to look for it. Could the experts at TTAC enlighten me on how a dealership actually makes money?

    Service and sales of used cars are where most of the profit for a dealer is. If you are a Honda or Toyota dealer, you make money on sales of new cars as well. If you are a Detroit 3 dealer, well, no.

    Now, some of those numbers are worse than they seem. For example, there aren’t many stand-alone Buick dealers left; most are Pontiac-GMC-Buick dealers. So three sales a month turns into 25. Still bad, but not OMGHOWDOTHEYSTAYINBUSINESS bad.

  • avatar
    Len_A

    Flex’s 134-day supply appears to be by design. According to an Automotive News article, on line, dated August 1, 2008, the Flex was launched in seven key metropolitan areas where Ford’s research showed there would be the most interest in Flex. Ford’s 10 remaining regions that will have their startup allocation of the Flex by September, according to a memo sent to their dealers.

    From the Automotive News reprint of Ford’s dealer memo:

    “The Division’s initial launch strategy for the Flex consisted of seven target regions: New York, Washington, Detroit, Atlanta, Orlando, Southwest and California. These regions are supporting the launch through a Tier II advertising campaign. To date, we have been able to offer every Select Dealer in these seven regions a start-up unit.

    In September the Flex will be launched nationally in the ten remaining regions. It is our intention to offer every Select Dealer in the country their start-up allocation by the September production period.”

  • avatar
    davey49

    Maybe Saturn’s 41 cars per dealer number has something to do with their sales technique. It’s nice to not be afraid of the car dealer.
    jeffreyweber- used cars and service keep all dealers in business. Profit for a new car is probably something like $500, for a used car its well into the $1000s.

  • avatar
    Matthew Danda

    Our local Dodge dealer closed recently. There are NO cars on its lot.

  • avatar
    geeber

    Len_A: That explains why the Ford dealer in my small hometown had no Flexes on the lot.

  • avatar
    07Frontier

    A local Nissan dealer is offering a free new Altima with the purchase of every new Titan or Armada. I’m sure there are caveats, as only so much can be said during a 30 second radio spot. But it beats the local Dodge dealer’s offer of Rams at 50% off.

  • avatar
    rottenbob

    I’d like to know the inventory figures for Chryco’s “compacts” (and I use the term loosely): Caliber, Compass, and Patriot. Surely they’re selling enough of these to ease the pain on the truck side of the business.


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