In the July edition of the CarGurus Vehicle Availability Index & Insights Report, Director of Industry Insights & Analytics Kevin Roberts provides a glimpse at the latest trends impacting inventory, which he’ll dive into in-depth at Navigate.
The narrative divergence between new and used continued in July as new inventory levels continued to tumble while used levels continued to rebound.
New inventory levels plunged further as the new Vehicle Availability Index reading for July came in at 26.9, a drop of 13.5% from June and down almost 60% from last year. There is hope that July could be the low point as production is forecasted to accelerate in August, which is welcome news. If new inventory continues to fall further, it’ll likely start to impact sales more dramatically.
Used inventory continued to bounce back in July, although the rate of recovery slowed, likely due to the drop we’ve seen with new vehicle sales. The used Vehicle Availability Index came in at 92.3, an increase of almost 1% from June, and a healthier recovery of 17.5% from last year. Although we’ve seen a strengthening in used inventory in recent months, there is a minor but existent concern of a potential stagflation-esque scenario, meaning low new inventory would depress new sales to a point that it would begin to pull down used inventory again with prices unable to stabilize.
Speaking of prices, we saw further increases in listing prices in July with the average new listing price rising to $43,224, an increase of 3.3% from Jun – so while consumers are likely to feel sticker shock, they must remember that the ‘S’ in MSRP stands for ‘Suggested’. The average used listing price increased at a slower rate in July and rose to $28,831, an increase of 2% from June, while still up over 34% from last year. In a positive development, used wholesale prices look to have plateaued in July, leading to hope on the consumer end that we may be nearing the end of price increases.
The changing tides of inventory further impacted days on market in July as new vehicles were for sale an average of under 65 days, a decline of 9.1% from June due to shrinking lots. Used saw its average days on market increase 3.6% from June to under 58 days due to recovery inventory levels.
The hope that July could be the inflection point on the wild ride we’ve been on this year remains in place; however, we’ve seen anticipated turning points come and go several times this year, and we’re likely looking at a long tail for the industry to return to ‘normal.’
To learn more about vehicle inventory trends, download the CarGurus Vehicle Availability Index & Insights July 2021.
Interested in learning more about the trends that will define 2022? We’ll be covering more insights like these and tips for staying ahead of the curve at Navigate, our third annual dealer conference
in Boston, October 13-14, 2021, held virtually from October 13-15, 2021. Check out the agenda and register today!