New Car Bargains? Unsold New Cars Crowding Dealers Lots
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Washington DC July 31, 2013; The AIADA reported that even with U.S. car sales zooming along, there are some signs automakers might be stepping on the gas a little too hard, reports Bloomberg Businessweek
Some 3.27 million new cars are now sitting on lots across the U.S., more than there have been in almost five years. That's a lot of cars--just enough to equip every man, woman, and child in the state of Iowa with a new vehicle, and just slightly less than the number of iPhones added to Verizon's network last quarter.
A year ago at this time, by contrast, there were 2.7 million vehicles lying in wait across the country; summer 2011 saw an inventory of about 1 million fewer cars.
Roughly 100 million cars in the U.S. are between seven and 12 years old, the "sweet spot" for high-maintenance repairs, according to Bloomberg analyst Kevin Tynan. At the pace Americans were buying cars last month, dealers can sell the current backlog in 61 days, which Tynan calls a "manageable" number.
In January, supply was at 75 days. But August isn't the best time for dealerships to be full, as most 2014 models will be rolled out in September.
