Car inventory shortage: Are we past the worst of it?

U.S. inventory levels, including vehicles in transit from factories, began a sharp and sustained decline in late March 2021, according to Cox Automotive. By August, consumers had opted for mostly clean dealer lots, and inventory levels were below his million. They reached their lowest point the following month, dropping to just under 830,000, Cox said.

By the end of 2021, inventories exceeded 1 million units, but remained very tight by July, bouncing between 1 million and 1.1 million units. Cox says stocks are starting to recover more rapidly after he topped 1.2 million in mid-August, and if the pace continues, he could cross the 2 million mark again earlier this year. .

The period of ultra-low inventories has been very favorable for most dealers and automakers, with many continuing to report record profits. I was able to do an experiment to find out.

Don Flow, CEO of Flow Automotive Cos. car news last week. His Dealers His group is headquartered in Winston-Salem, North Carolina and has 44 new car franchises.

Flo, who is in his third year as chairman of the Audi National Dealer Council, said Audi dealers and brands have used this period to find the best balance of overall profitability. “In the premium segment, we’ve found that if you produce the right car, you really only need between 20 and 30 days of car supply to maintain market share.” When we had supply, it was at the largest market share and dealers had the greatest profitability.”