In the five years before the pandemic, new car sales averaged 17.3 million per year in 2021, there were 14.9 million sold (-16%), according to Statista, a provider of consumer and market data. New car sales transactions have gone down. Demand will remain high despite rising gas prices and inflation, and our members have become diligent at working through their inventory and manufacturer issues to help customers as much as they can.” “A guy traveled 500 miles from Arkansas to one of our dealerships to purchase a car he knew was arriving. “The demand is definitely there,” he said. “High prices have offset lower inventory and fewer sales transactions,” said Will Green, president and CEO of the Louisiana Automobile Dealers Association, which represents 350 new motor vehicle car and heavy truck dealers in Louisiana. Non-luxury buyers are paying $1,030 over MSRP. New-vehicle prices continue to set records, with May’s average at $47,148 - a 16% increase from a year ago and the second-highest level on record. Power reports that during the past 12 months, new-vehicle prices have increased 15-20% compared with a 2-3% increase between 2012-2018. Since demand is up and supply is down, people are buying new cars at prices at or above the Manufacturer’s Suggested Retail Price (MSRP). The pandemic forced the automobile industry into a world of supply chain issues and computer chip shortages, resulting in manufacturers’ inability to build enough new cars to meet demand. “But we have seen wait times improve over the past two years, and we can work with the customer to cross reference availability from our manufacturer and place them in a new vehicle.” “It’s hard to deliver that nostalgic feeling of coming on a car lot, test driving several cars and then driving off the lot the same day with the car you want,” McCants said. Wait times can average 1-2 months, depending on make, model and accessories. The dealership averaged about 250 new cars sold per month then now they receive 80 new cars per month, and all are sold quickly, she said. McCants estimates inventory is down about 200% from pre-COVID years. We have had to adjust to this new norm for the last two years.” “Unfortunately, like many dealerships, our 13-acre lot has more empty concrete than inventory. We pretty much sell whatever we have,” said Laurie McCants, managing partner/general manager at Honda of Covington. “It’s like Christmas morning when we see a truckload of cars come in – most of them already have a customer’s name on them, while the few other new cars only last several days before they are sold. ![]() Most shoppers are there for a purpose – either the vehicle they ordered has arrived, or they need to order one that is not available on the lot. “Kicking tires” is a well-known expression in the automobile industry when shoppers walk around the dealership and look at all the cars available, usually with little intention of buying that day.īut there’s less tire rubber to kick nowadays.
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