Wednesday, 18 August 2021 21:57

New-Vehicle Supply Still Low but Starting to Stabilize

Written by Vehicle Remarketing Staff


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After slumping to historic lows in July, new-vehicle inventory, based on days of supply, showed signs of stabilizing as the U.S. industry entered August, according to a Cox Automotive analysis of vAuto Available Inventory data released Aug. 11.

Still, overall inventory remains far lower than normal while average listing prices keep climbing.


The total U.S. supply of available unsold new vehicles stood at 1.2 million units as July closed, down from 1.3 million at the end of June. As August opened, inventories were running 53% below 2020 levels and 68% below 2019 levels, according to a Cox Automotive analysis.


Supply has been trending lower since mid-December, just before the global computer chip shortage came to light and triggered production cuts.


Because the pace of new-vehicle sales slowed, the days’ supply edged higher throughout July to 31, compared with a record-low 29 days’ supply at the end of June.


The Cox Automotive days’ supply is based on the daily sales rate for the most recent 30-day period. New-vehicle sales lost momentum throughout June and July as consumers could not find the vehicles they wanted or balked at high prices. New-vehicle sales were up only 4% in July compared with a year ago.


The July sales pace (seasonally adjusted annual rate or SAAR) dropped to 14.8 million, after averaging more than 17 million a month in the first half of 2021.


“The new-vehicle market is starting to show signs of stabilization around inventory levels,” said Cox Automotive Senior Economist Charlie Chesbrough. “The sales pace has been falling as supply is constrained and consumers wait for improvement. While the days’ supply is stabilizing---and, in fact, it rose slightly at the end of July---inventories remain tight and are far from normal.”


Higher Vehicle List Prices


As August opened, the average listing price for new vehicles set another record. It rose to...

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