This short article was published by S&P Global Mobility and not by S&P Global Ratings, which is an independently handled department of S&P Global.

For all the talk of low stocks, and vehicle dealers adding
” market modifications” on top of MSRP, there were nearly a.
half-million units of leftover 2022 design year lorries still.
advertised for sale in the United States heading into the first.
weekend of December. That is on top of the 2023 automobiles that have.
been showing up on dealership lots.According to S&P Global Mobilitys analysis of United States dealer.
marketed inventory information, mainstream brands Ford, Chevrolet, Ram,.
and Jeep had about 300,000 units of 2022 designs marketed as.
available for sale the week ending December 4. Those four brand names.
represent 71% of 2022 promoted inventory listed by mainstream.
brand name dealers – and 66% of all dealer-advertised inventory when.
consisting of high-end marques.Among high-end brand names, Mercedes-Benz and Lincoln still showed the.
most remaining 2022 vehicles in dealership marketed stock,.
according to the S&P Global Mobility analysis.While most car manufacturers typically reduce off production in late.
summer season to transition to the brand-new model year, and clear out the last.
of their old models by Christmas, certain car manufacturers really have.
seen their 2022 inventories increase in October and November.” Model year discipline has dropped,” stated Cheryl Woodworth,.
consulting associate director for S&P Global Mobility. “With.
the chip shortage, stock control is not as meticulous as it.
used to be.” Is running old inventories into the new design year a bad thing?
It can be for car manufacturers, however it could spell retail relief for.
customers. With 22 designs bring the stigma of being “older” -.
even if the 2023 design is unchanged – that can imply dealerships are.
incentivized to blow out the zero-miles 22s.” The longer you wait to change over your model year, the more it.
hits your residual values in regards to harder grading,” Woodworth.
said.Some dealerships are using below-MSRP discount rates on lorries that.
brought sticker-price-plus Monroney labels just months before. And.
with customer demand subsiding due to external economic forces such as.
inflation and recession-related layoffs, the pressure to move the.
metal increases.Usually, the inventory arc for each design year follows a.
predictable curve, peaking in spring as production strikes its stride,.
and then coming down in summer season during the annual selldown and the.
design year transitions in September and October. Supply chain.
mayhem has actually made it impossible for some automakers to follow.
tradition.That stated, with particular elements of the supply chain still in.
flux, it might make sense for making connection to continue.
constructing 2022 models if a 2023 minor model modification includes a part.
that is not easily available, Woodworth said.In November, Ford was still providing 2022 Escapes to.
dealerships from its Louisville factory, as the 2023 minor model.
modification is still increase. The exact same extension of late.
production 22 models uses to the Ford Bronco Sport and Lincoln.
Corsair, which share a number of their foundations with the Escape.
platform.Remaining 2022 units are typically particular to specific designs. In.
the marketplace for a luxury SUV? The designs with the highest staying.
2022 model year systems are the Mercedes-Benz GLC and Lincoln.
Corsair.Why the excess 22 Mercedes GLCs? Its still waiting for a 2023.
refreshing – the nationwide mbusa.com website still wasnt listing.
the 2023 as readily available on December 15 – and as such 2022 models are.
still in strong supply. Amongst luxury brands, Mercedes had 33% share.
of staying 22 designs still marketed the week ending December.
4, while Lincoln accounted for 22% share of leftover high-end.
22s. That said, Mercedes dealers have actually done a strong job of selling.
down its 2022 inventories from mid-summer in anticipation of the.
23 model arriving. And other key Mercedes volume designs – GLE,.
S-Class, and C-Class – are mostly represented by 2023 design.
production.Supply chain hiccups likewise are impacting inventories in other.
ways. Tens of thousands of so-called “ghost systems” of the F-150 and.
Chevrolet Silverado have actually rolled off the assembly line however were.
missing crucial parts, and have been collecting in car park.
near their respective factories until they can be launched. On top.
of those incomplete units, Ford dealerships had nearly as many F-150s.
promoted the week ending December 4 as they carried out in August in.
September. When the ghost systems finally get their needed parts.
and enter wholesale stock – Ford hopes it will occur by the.
end of December – that will add to the pressure to clean out the.
22 models at the dealer level.The combined black-swan events of COVID, semiconductor.
shortages, and the Russian intrusion of Ukraine interfered with.
standard production and supply norms – the most recent downstream.
effect being the overrun of previous model-year production and.
inventory. How the industry can recover to its regular cadence.
depends on its adaptability to these continued disruptions.