4.1 million cars sat unsold in May 2019.
It’s no secret at this point that car sales are slowing down. Following months upon months of records, recent trade tariffs, rising prices and falling demand, automakers and dealers have a problem on their hands: oversupply. Lower sales in April 2019 left dealers with their highest level of supply since 2009, in the midst of the global financial crisis.
Heading into May, dealers had an estimated 4,120,900 unsold vehicles on hand, according to Automotive News Data Center figures. That means they have a 78-day supply — the highest start to the summer season since the market reached a record 85-day supply in 2009. Of that 4.1 million cars and light trucks, over half are from General Motors, Ford or FCA brands. One third were from Japanese automakers, while the rest came from European and Korean brands.
Higher import oversupply
While American cars take the lion’s share of unsold inventory, unsold imports also rose in May. The total amounted to a 69-day import supply on May 1, according to AutoNews. Subaru had the least amount of oversupply. Fiat, on the other hand, maintained the highest oversupply in the market.
In recent sales reports, we pointed out that passenger cars are struggling while trucks continue to gain steam. In April 2019 alone, for example, Ram truck sales grew 25 percent over the same point last year. With a few outliers, the 10 best-selling cars remained steady or actually lost sales momentum last month.
Sales slump = best time to buy?
While the situation may not be the best for dealers, consumers may take advantage. If you are in the market for a new car, dealers will likely offer larger incentives to reduce their unsold inventory. Some Ford dealers, for example, are still trying to clear out 2018 Ford F-150s with the 3.0-liter PowerStroke diesel engine. Some are offering up to $16,000 off with no questions asked.
On the car side, some dealers and automakers are offering up to $3,000 off the Toyota Camry, with incentives and rebates. Again, that’s before any negotiating. Customers who are flush to buy a new car may be able to snag a deal when oversupply hits new highs, as it did this month.