The supply of new cars has been hammered by a shortage of semiconductors used in cars. That shortage has caused some of the largest car companies to shut assembly lines and has hit earnings hard. And the chip shortage could last until next year. The by-product of these factors is that car prices, both new and used, have skyrocketed. Popular cars are basically unavailable.
One primary set of data the industry follows is called “days on dealer lot.” In a normal car market, the average number of days a car sits on the lot until it is sold is around 50. That has dropped by about half recently to 24.6 days, according to iSeeCars.
Reacting to the change in car demand, iSeeCars Executive Analyst Karl Brauer commented:
The demand for new and used cars has slowed in October, which is likely the result of increased inventory over September and because elevated car prices may have deterred consumers from buying a car until prices stabilize. Production halts and restricted inventory continue to beset the auto industry, but we did see an incremental improvement this past month.
iSeeCars looked at the fastest-selling cars in each state. The analysis covered 250,000 new and used vehicles sold in October. The average number of days it took to sell a new car was 31.7 days. For used cars, the comparable number was 44.7 days. The research firm then looked at the fastest-selling new and used cars based on the same yardstick.
The data raise a critical question. When can the industry begin to recover? Car and chip company executives have made forecasts that range from early next year to early 2023. By then, demand should be off the charts. People may be able to buy the cars they want to have faster, but it will take some time for supply to catch up, even when assembly lines are at full capacity. Among the problems consumers will face at that point is price. Dealers will be able to sell cars without discounting them and in some cars will get prices above the manufacturer’s suggested retail price (MSRP).
This is the fastest-selling new car in each state:
|State||Vehicle||Average Days to Sell|
|California||Toyota Highlander Hybrid||8.3|
|Florida||Toyota Camry Hybrid||8.3|
|Indiana||Jeep Wrangler Unlimited||8.0|
|Massachusetts||Lexus RX 350||8.6|
|Minnesota||Hyundai Santa Cruz||11.1|
|Nevada||Lexus RX 350||10.0|
|New Hampshire||Hyundai Tucson Hybrid||13.4|
|New Jersey||Honda Civic||9.0|
|New Mexico||BMW X3||13.1|
|New York||Toyota RAV4 Hybrid||8.2|
|North Carolina||Jeep Wrangler Unlimited||9.4|
|Rhode Island||Subaru Forester||10.4|
|South Carolina||Toyota Camry Hybrid||8.8|
|Washington||Toyota Highlander Hybrid||8.5|
|West Virginia||Jeep Wrangler Unlimited||10.0|