New Vehicle Inventory May Be Rising: What’s Next?

According to ZeroSum data, new vehicle inventory is expected to rise 2.87% by the end of August while used vehicle inventory could fall 3.48%. At the same time, average new vehicle prices rose 0.10% to $48,429 and used vehicle prices increased 0.53% to $34,242.

Staff Writer・Editorial

Read Staff's Posts

August 24, 2022

New Vehicle Inventory May Be Rising: What’s Next? — According to ZeroSum data, new vehicle inventory is expected to rise 2.87% by the end of August while used vehicle inventory could fall 3.48%. At the same time, average new vehicle prices rose 0.10% to $48,429 and used vehicle prices increased 0.53% to $34,242.

2 min to read

GRAND RAPIDS, Mich. – The ZeroSum Market First Report predicts month-end vehicle movement, providing vital supply and demand trend data to automotive marketers and dealers. ZeroSum uses predictive modeling to accurately estimate new vehicle inventory, pricing trends, and market share.

According to ZeroSum data, new vehicle inventory is expected to rise 2.87% by the end of August while used vehicle inventory could fall 3.48%. At the same time, average new vehicle prices rose0.10% to $48,429 and used vehicle prices increased 0.53% to $34,242.

Data from The Federal Reserve shows that United States car production hit a two-year high in July, returning to pre-pandemic levels. Although it is expected that the chip shortage will improve over the remainder of 2022, not all automakers are optimistic about their year-end performance. BMW has lowered its production forecast for the second half of the year, citing volatile chip and European energy supplies and warned it may not meet earnings targets. Meanwhile, Mercedes-Benz also reported limitations in vehicle availability but is anticipating much higher 2022 revenues than previously predicted.

ZeroSum’s Take: What You Need to Know

New vehicle inventory is expected to rise to 1,068,688 by the end of the month which would be a significant shift from July when inventory declined. When more new cars are available, ZeroSum expects used car prices to come back down.

Here are your key takeaways:

Continue marketing used vehicles. The average used car price rose to $34,242 in August. Sell as many used cars as possible while prices remain high.
Closely monitor pricing trends. By the end of the month, new vehicle inventory could be up almost 3%. Rising new vehicle inventory to cause used car price drops in the coming months and require you to adjust your pricing strategy accordingly.
Continue acquiring EVs. EV registrations are up while inventory is down. Prepare for EV demand by increasing your available stock of electric and hybrid cars.

To read the entire report and view supplemental charts, visit our website:https://www.zerosum.ai/blog/zerosum-market-first-report-2022-8

Topics:Dealer Ops

Subscribe to Our Newsletter

More Dealer Ops

Timing the Market Can Hurt Long-Term Program Performance

For dealer-owned reinsurance entities, avoiding volatility entirely can mean falling behind inflation and missing market rebounds that drive long term surplus growth. Missing just a handful of strong market days can materially impact cumulative returns—an important reminder for long horizon trust and investment strategies.