Bloated Auto Inventories Deflate Slightly

Matt Posky
by Matt Posky
bloated auto inventories deflate slightly

Due to weakening new-vehicle sales, the United States was staring down the barrel of near-record inventories a couple of months ago. Encouraged by the factory to ensure their lots were filled with the latest wares, dealers have watched their margins evaporate as employees and customers drowned in the sea of metal parked out front.

While still uncomfortably high, U.S. inventories started creeping back down in May. By the end of the month, the number of vehicles waiting to be adopted fell below 4 million for the first time since the beginning of 2019.

Dealers and automakers opened June with an estimated 3,992,100 vehicles at the ready, according to figures compiled by Automotive News. The 65-day supply is reportedly on par with last year’s figures and represent a marked improvement over the 78 days from last April.

From Automotive News:

Automakers and dealers opened June with an estimated 1,022,500 unsold cars, a 59-day supply that represents about 26 percent of total inventory.

No automaker or brand had less than a month’s supply of inventory, with Subaru again running the leanest levels.

Meanwhile, a pair of Fiat Chrysler Automobiles vehicles marked the opposite ends of the inventory spectrum on June 1: Dealers had just a 10-day supply of the Dodge Grand Caravan but an industry-worst 254-day supply of the Fiat 500L.

Despite appearing to have put on its blinker to turn the corner, the U.S. is still coping with sizable inventory bloat. While many are making direct comparisons to the build up of new vehicles that foreshadowed the Great Recession, the reality is that most automakers are doing substantially better at present. Unfortunately, we doubt that has provided much comfort to the dealerships that are taking this on the chin. Lackluster sales, factories shying away from incentives, and rising interest rates aren’t doing them any favors.

[Image: Bell Ka Pang/Shutterstock]

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  • Jkross22 Jkross22 on Jun 17, 2019

    I wonder how many lots are full of unsold cars and trucks that won't ever be sold and how much premium that adds to the MSRP of new cars that are leased or purchased.

    • See 1 previous
    • PrincipalDan PrincipalDan on Jun 17, 2019

      @quaquaqua 2007 Chrysler Crossfires were still in new dealer inventory in 2009, they even tried clearancing them on "Overstock.com" but they did eventually sell.

  • Sportyaccordy Sportyaccordy on Jun 17, 2019

    It feels like a different story with used inventory. On an impulse I went car shopping this weekend and all the abundant models I saw earlier in the year were hard to find. Maybe inventory swells seasonally...

  • Jim Bonham Full EVs are not for everyone, they cannot meet all needs. Hybrids do a much better job of providing the benefits of EVs without most of the drawbacks. I have a hybrid sedan with plenty of room, plus all the bells and whistles. It has 360 hp, AWD, does 0-60 in just over 5 sec.(the instant torque is a real benefit), and I get 29 mpg, average. NOT driven lightly. I bought it used for $25k.Sure, it's a little heavier because of the battery, motor, etc., but not nearly as much as a full EV. The battery is smaller/lighter/cheaper and both the alternator and starter motor are eliminated since the motor assumes those functions. It's cool to watch the charge guage show I'm getting energy back when coasting and/or braking. It's even cooler to drive around part of the time on battery only. It really comes in handy in traffic since the engine turns off and you don't waste fuel idling. With the adaptive cruise control you just let the car slowly inch along by itself.I only wish it were a Plug-in Hybrid (PHEV). Then, I'd have A LOT more EV-only range, along with even more of that instant torque. The battery would be bigger, but still a fraction of the size of a full EV. I could easily go weeks without using much, if any gas (depending upon my commute) IF I plug it in every night. But I don't have to. The gas engine will charge the battery whenever it's needed.It's just not as efficient a way to do it.Electric companies offer special rates for both EVs and PHEVs which lower your operating cost compared to gasoline. They'll even give you a rebate to offset the cost of installing a home charger. You can still get federal (up to $7,500, plus some state) tax credits for PHEVs.What's not to like? My next daily driver will be a PHEV of some kind. Probably a performance-oriented one like the new Dodge Hornet or one of the German Hybrid SUVs. All the benefits, sound, feel, etc., of a gas vehicle along with some electric assist to improve fuel economy, performance, and drivability. None of the inherent EV issues of cost, range anxiety, long charging times, poor charger availability, grid capacity issues, etc. I think most people will eventually catch on to this and go PHEV instead of going full EV. Synthetic, carbon-neutral eFuels, hydrogen engines, and other things will also prevent full EVs from being 100% of the fleet, regardless of what the politicians say. PHEVs can be as "clean" (overall) as full EVs with the right fuels. They're also cheaper, and far more practical, for most people. They can do it all, EVs can't.
  • Ron rufo there is in WaSHINGTON STATE
  • ToolGuy @Chris, your photography rocks.
  • ToolGuy No War for Oli.If you have not ever held a piece of structural honeycomb (composite sandwich) in your own hands, try it.
  • ToolGuy You make them sound like criminals.
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