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CarGurus Vehicle Availability Index & Insights – January 2022

Posted by Kevin Roberts on February 2, 2022

So far, 2022 has felt like déjà vu – instead of a hopeful new start, we’re instead seeing several familiar refrains from 2021. Thankfully, though, we appear to be at an inflection point in a journey to a ‘new normal’ versus backsliding into further disruption of 2021.

New inventory levels declined slightly in January by 5%, although month-end and weekly seasonality trends had a strong part in that decline, as the inventory index reading was flat with December just a couple of days prior. With how threadbare new inventory has become, month-over-month variances have become a bit sensitive – however, the year-over-year numbers still show new inventory down nearly 70%. Conversely, used inventory continued to see improvement in January and is now down just 0.8% compared to last year. The recovery in used inventory volumes is one reason we saw a recovery in 2021 used sales, while new sales volumes continue to be impacted.

This tightness in new inventory has meant that vehicle prices remain high, although the average new price has decreased slightly by 0.5% to around $46k. Why is the average price declining while inventory remains tight? As automakers get access to more chips, they’re going to start building a wider selection of vehicles and trims instead of prioritizing the most profitable ones, so we’re likely to see some reduction in new average listing price throughout the year. Interestingly, the average listing price for used continues to rise even with a near-full recovery in used inventory, highlighting the continued impact on missing new inventory throughout the industry. The used average listing price rose nearly 1% from December and is now approaching $31.6k.

We saw another interesting shift with new days-on-market increasing by 2.7% to under 47 days despite inventory levels decreasing. With an increase in vehicles on market between 50-90 days month-over-month, the supermajority of these vehicles were at, or above, MSRP and were primarily pickups, SUVs, and CUVs – perhaps highlighting that consumers, while still highly in demand for private mobility, might be becoming more price sensitive. There were no surprises with used days-on-market, which also rose by 2.7% to just under 67 days.

As mentioned last month, the path to a ‘new normal’ is going to be anything but linear, and further unexpected disruptions could arise. However, January’s data didn’t arrive with any serious potholes, and we’re likely set up for some further normalization in February and beyond.

To learn more about vehicle inventory trends, download the CarGurus Vehicle Availability Index & Insights January 2022.   

Topics: inventory, new vehicles, used vehicles