One Voice Report: Auto dealers facing inventory challenges

Posted by Sarah Pekala on February 26, 2020

Acquiring inventory is fundamental to car selling, but it’s becoming a common challenge year after year. In our recent One Voice Report, 76.3% of used car dealers reported that they found it more difficult to source the inventory they wanted in 2019 compared to 2018. Almost a third (32.8%) rated it as very or extremely difficult. Built around a survey of nearly 1,000 independent and franchise car dealers and our annual Dealer Council meeting, the inaugural CarGurus One Voice Report examines the inventory challenge and how dealers are coping.

“Cars are tough to come by,” said Jeff VanderWall, Owner of ClearShift Cars. “It takes a lot of hustle and a lot of innovation to be able to do it well. The turnaround time is high—to buy them, to get them to your store, to recondition them, it takes a long time to get them sold. All that stuff eats up cost.”

A number of dealers blame the yo-yo effect of manufacturers pushing cars into fast-turn daily rental and lease markets and then pulling back from this tactic. This made it difficult to reliably buy these cars for inventory. Several dealers claim rivals are holding onto and selling a higher proportion of trade-ins than in the past, and are only sending less-than-ideal vehicles to auction. Smaller dealerships often blame the buying power of the larger used car chains for acquiring all the good inventory—a trend also seen in the UK version of the 2020 CarGurus One Voice Report.

While it may be difficult to consistently find the right inventory, some retailers believe they are up to the task. One said: “I foresee it continuing to be a challenge, but not impossible. We use a few different tools to acquire our used inventory and will continue to watch what’s happening and be aggressive with making sure our inventory contains what it should.”

To learn more about the topics at the top of U.S. dealers’ minds, download the full CarGurus One Voice Report.

Topics: best practices, CarGurus data, dealer insights, trends