Does Inventory Drive Incentives?
Does Inventory Drive Incentives?

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Since March, automotive manufacturing and retail have experienced trickle-down effects which are causing a conflict between inventory levels and incentives.  What offers will keep the industry stimulated, attract buyers and continue a steady sales pace while inventories are depleted and under pressure from CPO/nearly new units coming into market?

Looking at two markets using MDS (market days supply from vAuto), let’s compare the DMA’s – Peoria/Bloomington with 113 days supply of new vehicles compared with Bakersfield having 56 MDS.  As part of the analysis, factors like local market economics and high sales brand inventory levels are important for comparing the OEM incentive offers to help us understand the discounting strategy OEM’s use for adjusting inventory supply, demand and replenishment of dealer stock from factories just gearing up production.

For the purpose of this evaluation we will look at 2020 models from Ford, GM and Nissan for both retail and lease offers supported by the manufacturer.  

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