This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed department of S&P Global.
For all the talk of low inventories, and car dealers adding
” market modifications” on top of MSRP, there were almost a.
half-million units of remaining 2022 model year cars 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 arriving on dealership lots.According to S&P Global Mobilitys analysis of United States dealer.
advertised stock information, mainstream brands Ford, Chevrolet, Ram,.
and Jeep had about 300,000 units of 2022 designs marketed as.
offered for sale the week ending December 4. Those four brands.
account for 71% of 2022 promoted inventory listed by mainstream.
brand dealers – and 66% of all dealer-advertised stock when.
including high-end marques.Among luxury brand names, Mercedes-Benz and Lincoln still showed the.
most remaining 2022 automobiles in dealer marketed inventory,.
according to the S&P Global Mobility analysis.While most car manufacturers typically reduce off production in late.
summertime to shift to the brand-new model year, and clear out the last.
of their old models by Christmas, certain automakers actually have.
seen their 2022 stocks increase in October and November.” Model year discipline has actually dropped,” said Cheryl Woodworth,.
consulting associate director for S&P Global Mobility. “With.
the chip lack, stock control is not as precise as it.
used to be.” Is running old inventories into the brand-new model year a bad thing?
It can be for car manufacturers, however it could spell retail relief for.
consumers. With 22 designs carrying the preconception of being “older” -.
even if the 2023 model is unchanged – that can mean dealerships are.
incentivized to blow out the zero-miles 22s.” The longer you wait to change over your design year, the more it.
hits your residual values in terms of harder grading,” Woodworth.
said.Some dealerships are providing below-MSRP discount rates on automobiles that.
brought sticker-price-plus Monroney labels simply months prior to. And.
with customer need waning due to external financial forces such as.
inflation and recession-related layoffs, the pressure to move the.
metal increases.Usually, the stock arc for each design year follows a.
predictable curve, peaking in spring as production strikes its stride,.
and after that coming down in summer during the annual selldown and the.
model year transitions in September and October. But supply chain.
chaos has actually made it impossible for some car manufacturers to follow.
tradition.That said, with certain elements of the supply chain still in.
flux, it might make sense for producing continuity to continue.
If a 2023 minor model change includes a part, building 2022 models.
that is not easily offered, Woodworth said.In November, Ford was still providing 2022 Escapes to.
dealers from its Louisville factory, as the 2023 minor design.
modification is still increase. The very same continuation of late.
production 22 designs applies to the Ford Bronco Sport and Lincoln.
Corsair, which share a number of their underpinnings with the Escape.
platform.Remaining 2022 systems are often particular to specific designs. In.
the marketplace for a high-end SUV? The models with the highest staying.
2022 design year units are the Mercedes-Benz GLC and Lincoln.
Corsair.Why the excess 22 Mercedes GLCs? Its still waiting for a 2023.
refreshing – the national mbusa.com site still wasnt listing.
the 2023 as offered on December 15 – and as such 2022 models are.
still in strong supply. Among 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 stocks from mid-summer in anticipation of the.
23 design showing up. And other key Mercedes volume models – GLE,.
S-Class, and C-Class – are mostly represented by 2023 model.
production.Supply chain missteps also are impacting stocks in other.
methods. Tens of thousands of so-called “ghost units” of the F-150 and.
Chevrolet Silverado have actually rolled off the assembly line but were.
missing out on crucial parts, and have actually been collecting in car park.
near their respective factories until they can be released. On top.
of those unfinished systems, Ford dealerships had almost as numerous F-150s.
promoted the week ending December 4 as they did in August in.
September. When the ghost units finally receive their needed parts.
and go into wholesale stock – Ford hopes it will take place by the.
end of December – that will contribute to the pressure to clean out the.
22 designs at the dealership level.The integrated black-swan events of COVID, semiconductor.
shortages, and the Russian invasion of Ukraine interrupted.
conventional production and supply standards – the latest downstream.
effect being the overrun of prior model-year production and.
inventory. How the industry can recover to its regular cadence.
depends on its versatility to these continued disturbances.