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U.S. car dealers are getting squeezed by near-record inventories
May 1, 2019

From Automotive News:

Automakers and their dealers have millions of reasons to be concerned about weakening U.S. new-vehicle sales – nearly 4.2 million reasons, to be more precise.

That's how many unsold cars and trucks the industry had on hand going into this month, an unwieldy pool of vehicles that has spilled into vast overflow lots popping up wherever enough wide-open space is available: shuttered factories, vacant shopping centers, barren fields.

The estimated 4,188,200 unsold vehicles on April 1 was the highest inventory number for any month since that reported for July 1, 2017, and just 114,300 vehicles less than the modern-day record set in May 2004, according to the Automotive News Data Center. It's over half a million vehicles more than automakers and dealers were grappling with in the spring of 2007, when the Great Recession was just around the corner. The figures do not include the estimated 18,000 electric vehicles that Tesla had in inventory this month.

Bulging inventories, combined with rising floorplan interest rates, are sapping whatever was left of dealers' new-vehicle margins and threaten to unravel the industry's hard-fought pricing discipline if demand erodes further.

Continue reading at Automotive News...

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