It’s the same tale we’ve heard for over a year now: trucks and SUVs are hot, and passenger cars are not. We’ve seen Ford and General Motors can nearly every passenger car on sale today in favor of utility vehicles.
Now, that focus has created a somewhat different kind of problem. Per an Automotive News (subscription required) report on Monday, the industry saw the number of unsold passenger cars drop to its lowest level since 2011. Translation: the cars that have slipped in popularity are actually in shorter supply. After all, plenty of buyers are still actually buying Malibus, Camrys, and Accords.
The raw numbers speak for themselves. In the beginning of July, there were an estimated 1,008,000 passenger cars unsold on dealer lots, or a 60-day supply. Total, that’s about 25 percent of the total inventory mix. In contrast, through the first six months of this year, passenger cars accounted for 29.4 percent of new vehicle sales. There lies the 4.4 percent gap between supply and demand.
Overall, inventories are slightly higher than 2018 figures, but still below 2017 levels. Recall, GM famously held an incredibly high inventory level two years ago. GM pledged to get the figure down, and it’s done just that in the past couple of years. The entire industry holds at 69-day supply of vehicles across all segments.
The news shouldn’t exactly shine a light on the passenger car’s sudden return. Trajectories still show the sedan will continue to decline in favor of utility vehicles for the near future. However, buyers previously considering, say, an American compact sedan will be forced to shop elsewhere.