The U.S. auto industry, battered early last year by the COVID-19 pandemic generally recovered sales by the end of the year. 2021 should be even better. Not only have car companies launched new models–they are counting on the appeal of the next generation of electric cars, with Elon Musk’s Tesla Inc. already in the vanguard of that market. But, some car companies found several models they could not move off lots. Based on industry standards, dealers usually have 20% of a year’s unit sales in inventory so they can satisfy customer demand. At the end of last year, one model had almost 100% of a year’s inventory in stock across the manufacturer’s dealer network, an astronomically high number.
iSeeCars looked at a total of 700,000 cars in investor at America’s dealers. It “the average new model has 22.5 percent of its inventory remaining from 2020.” At the high end of the list, The Ford Escape has 90.4% of its 2020 inventory still available.
The Escape is Ford’s small SUV/crossover, marketed for a low price and high gas mileage. The base price of the car is $24,885. Ford’s incentives on the Escape speak to the inventory problem. In one part of the U.S., the Escape is available with 60 months 0% APR financing or alternatively a $3,000 “cash back” incentive, which is high for a $25,000 car.
Car research shows that the Escape is not considered a very good car or a very bad one. It has a rating of 7.5 out of 10 by Car & Driver. Edmunds score is 7.7 out of 10. Car & Driver editors wrote: “With a car-like design and driving demeanor, decent interior room, the Ford Escape is a solid mid-pack compact SUV, but several others do the job better.” Not enough praise to drive hordes of people to showrooms.
iSeeCars Executive Analyst Karl Brauer supplied a further explanation. “Ford Escape sales dropped by 26 percent in 2020 compared to 2019, and Ford didn’t begin production of the 2021 version until early January.”
The largest hurdle Ford has with the Escape is competition. The low-priced crossover/SUV market has been dominated by the Honda CR-V and Toyota RAV4. Notably, neither of the models make the iSeeCars high inventory list, which means their sales are at least average, if not brisk.
The second highest model on the iSeeCars list is the Ford EcoSport, the manufacturer’s tiny subcompact crossover. Priced at $19,995, it has a horrible rating of 3.5 out of 10 at Car & Driver. 71.3% of EscoSports were still in inventory at year-end.
What was once Chevy’s run at a “Tesla killer”, the Chevy Bolt EV is third on the iSeeCars excess inventory list with 68.9% It gets strong marks with 8 out of 10 at both Car & Driver and U.S. News.
Ford has its work cut out for it in 2021. It needs to clear all those Escapes off the lot.
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