October inventory trends: strike vehicles, small SUVs, and electric vehicles

October inventory trends: strike vehicles, small SUVs, and electric vehicles

Time Stamp: October 25, 2023 2:15 AM
Source Node: 2956302

Pulling from retail advertised
inventory data for the week of Oct 9-15, S&P Global Mobility
delivers the following insights on the US market:

Overall industry inventories

New vehicle inventory listings have sharply
accelerated in the past month; from slightly more than 2 million
units as of Sept. 11, now approaching 2.5 million units – more than
a 10% increase in a one-month span, and 64% higher than this period
last year. The legacy Detroit brands matched the trend, with
inventories jumping from about 995,000 to 1.08 million over the
same span, an 8% jump.

Source: S&P Global Mobility Retail
Advertised Inventory data, week of Oct 9-15, 2023 ©2023 S&P
Global Mobility

2023 vs 2024 model years

There still are more 2023 model vehicles in
dealer advertised inventories than incoming 2024s; however, 2024
model year advertised inventory is now reaching the level of
remaining 2023 model year units. And while we see the 2023 MY
advertised inventory decreasing, the 2024 MY inventory is growing
at a faster rate than the 2023 MY sell-down.

Source: S&P Global Mobility Retail
Advertised Inventory data, week of Oct 9-15, 2023 ©2023 S&P
Global Mobility

Strike vehicles

Retail advertised inventories of the vehicles
affected since the beginning of the UAW strike — Ford Ranger,
Ford Bronco, Ford Explorer, Lincoln Aviator, Chevrolet Colorado,
GMC Canyon, Chevrolet Traverse, Buick Enclave, Jeep Wrangler, and
Jeep Gladiator — have dropped from 160k to 141k since the week
of September 18. It is uncertain if those vehicles’ inventory
situation could be worse, if not for dealers slowing their sales
velocity in case of a long-term strike impact.

Source: S&P Global Mobility Retail
Advertised Inventory data, week of Oct 9-15, 2023 ©2023 S&P
Global Mobility

However, once the strike vehicles are removed
from the equation, the domestic manufacturers have been increasing
retail advertised inventory for other vehicles at a sharp rate.

Source: S&P Global Mobility Retail
Advertised Inventory data, week of Oct 9-15, 2023 ©2023 S&P
Global Mobility

Compact Mainstream SUVs

The small SUV segment is once again turning
into a dogfight, as overall retail advertised inventories continue
to rise sharply.

Source: S&P Global Mobility Retail
Advertised Inventory data, week of Oct 9-15, 2023 ©2023 S&P
Global Mobility

In looking at specific vehicles, the Nissan
Rogue, Chevrolet Equinox, Hyundai Tucson, and Ford Escape have all
seen inventories spike in the past month, while Toyota appears to
have executed a summer sell-down of the RAV4, and the Jeep Wrangler
has declined, likely due to the UAW strike. And while Honda CR-V
inventory percentages climb, dealer advertised inventories remain
well below one month’s sales velocity.

Source: S&P Global Mobility Retail
Advertised Inventory data, week of Oct 9-15, 2023 ©2023 S&P
Global Mobility

Electric vehicles

Inventories of EVs other than Teslas continue
to rise, as continuing consumer concerns on affordability and
charging network accessibility impact desirability. To ease the
pressure on dealers, and increase consumer marketing exposure in a
lower-pressure environment, some OEMs are increasing their EV sales
to rental and corporate fleets.

Source: S&P Global Mobility Retail
Advertised Inventory data, week of Oct 9-15, 2023 ©2023 S&P
Global Mobility

In looking at specific EV models, however,
there are some concerning trends in terms of inventories vs.
overall sales as reported by manufacturers (retail and fleet). Ford
has nearly 22,500 units of the Mustang Mach-E in dealer advertised
inventories; but total sales for the trailing three months amount
to just 14,842 units (as reported by Ford). Same goes for the F-150
Lightning, which has nearly 9,000 units in inventory, but has sold
just 3,500 units in the trailing three months (Ford recently cut a
shift at the Rouge Electric Vehicle Center in response). Here are
the inventory-to-sales equations for other key players in the EV
market:

VW ID.4: 11,191 units in retail advertised
inventory vs 10,707 in reported 3Q sales

Nissan Ariya: 5,574 in inventory vs 4,504 in 3Q
sales

Hyundai Ioniq 5: 6,979 in inventory vs 11,665
in 3Q sales

Chevrolet Bolt EV and EUV: 5,363 in inventory
(mostly Bolt EUV) vs 14,709 in 3Q sales. GM recently announced a
production increase on these models.

An interesting side note: The Chevrolet Bolt EV
and EUV siblings have been the best-selling non-Tesla EV nameplate
in the industry for 13 consecutive months, while the Mustang Mach-E
has been in the top 5 among all EVs (including Tesla) in 10 of the
last 13 months, according to analysis of S&P Global Mobility
total new light vehicle registration data through July 2023.

Source: S&P Global Mobility Retail
Advertised Inventory data, week of Oct 9-15, 2023 ©2023 S&P
Global Mobility

FOR MORE ON INVENTORY
DATA AND MARKET INTELLIGENCE

ELECTRIC VEHICLES: TOO
MANY TOYS ON THE SHELF

LIGHT VEHICLE SALES
FORECASTING

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This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed division of S&P Global.

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