Automotive Industry Includes In-Transit Vehicles in Available Inventory to Meet Consumer Demand

As a result of supply chain shortages, consumers have struggled to find new cars to buy over the last two years. New-vehicle inventory bottomed out in October 2021 at around 850,000 and remained stuck at close to 1,000,000 vehicles for the next nine months until July 2022. In response to the low level of supply and the consequential pent-up demand, auto dealers began aggressively listing vehicles as “in-transit” to signal to consumers that vehicles were on their way. Since then, the use of “in-transit” inventory has remained a staple in the automotive industry.

Cloud Theory, a leader in supply and demand-related automotive insights, analyzed in-transit vs. in stock inventory data and determined the following:

1. New vehicle inventory levels available on dealer websites have increased 61% from July 2022 to January 2023.
2. 68% of the increase is attributable to in-transit vehicles.
3. More than one-quarter (25.8%) of all new vehicles listed on dealer websites are in-transit.

Recommended AI: UTB Bot Unveils a New Way to Leverage Automation and Cryptocurrencies

In-transit inventory also impacts sales numbers. In January 2023, 40% of the vehicles listed as in-transit were sold, indicative of pent-up demand. Vehicles classified as in-transit accounted for 16.8% of new vehicle sales. For these in-transit vehicles, days-to-move (26 days) is much shorter than it is for in-stock vehicles (36 days), indicating that consumers are anticipating the arrival of those vehicles and preparing for their purchase before it is delivered.

Subaru and Audi have more than half of their inventory in-transit. General Motors is also aggressive at listing in-transit inventory, with all four of its brands appearing in the top 10.

“This in-transit dynamic will continue to be an important tool for dealers and OEMs to balance the two sides of that equation for the next 12-18 months,” says Rick Wainschel, Vice President, Data Science & Analytics at Cloud Theory. Cloud Theory will publish more information on in-transit inventory and its impact on the industry in the coming weeks.

Recommended AI: AI Smart Chain Ecosystem Launches, Bringing Artificial Intelligence to Crypto Space

[To share your insights with us, please write to sghosh@martechseries.com]