Cloud Theory, the real-time automotive data insights provider for automotive manufacturers, agencies, and affiliates is reporting in June’s On The Horizon report that new vehicle movement hit 1.2 million for the first time since May 2021. While June numbers are expected to fall back slightly, the industry continues to show strength through its sales trajectory over the past several months.
This growth is largely being driven by continued momentum in new vehicle inventory, which grew 2.8% MoM in May and now sits at 2.89 million.
Turn rates remained in their recent narrow range at 40%, and that metric has been in the high 30s to low 40s since November 2023. New vehicle marketed prices, which had been declining since July 2023, ticked up for the second straight month and rose above the long-term trendline.
“The flat turn rate trend indicates that gains in movement are the result of increased supply rather than from higher sales efficiency,” said Rick Wainschel, Vice President of Data Science & Analytics at Cloud Theory. “More supply means more competition for OEMs, and the recent ramp-up in incentives levels will need to continue in order to maintain the recent industry momentum.”
Toyota Motor Corporation asserted its dominance in terms of Inventory Efficiency Index, with Toyota and Lexus in the top two spots nationally and in 7 of the 9 regions. However, the way those two brands demonstrated that strength differed in May. Toyota’s vehicle movement increased slightly (+1% MoM) even though its average inventory position degraded by 8%. Lexus, on the other hand, saw its movement jump by 34%, which far surpassed its supply growth (+5%), resulting in an increase in its score.
“Toyota Motor Corporation’s May performance demonstrates that there is more than one path to sales efficiency,” said Ron Boe, Chief Revenue Officer at Cloud Theory, “but the strength shown by both Toyota and Lexus speaks to the power of their two brands in the marketplace.”
To see more trends and forecasts on inventory, movement, segment trends, and inventory efficiency, download a copy of the June 2024 On the Horizon report here.
Cloud Theory’s On the Horizon report puts proprietary, real-time data into a historical context, so automotive OEMs can view and understand critical insights that help make decisions involving allocating marketing and incentives dollars.