New-Vehicle Supply Turns to Glut for Many Brands. Automakers Roll out Incentives, but Not Nearly Enough

Inventory gluts are resolved by lower prices that boost sales. But that part hasn’t started yet; the glut is still building.

By Wolf Richter for WOLF STREET.

It’s a good thing for new-car and new-truck buyers to go from inventory shortages, the odious addendum stickers we saw during the pandemic, spiking prices, and obscene profit margins by dealers and automakers to an inventory glut.

The inventory glut is starting to take on momentum. Incentive spending by automakers has been ramped up. Ultimately, inventory gluts are resolved by lower selling prices that stimulate higher unit sales as more customers find attractive deals. But that part hasn’t started yet; the glut is still building.

So far in 2024, new-vehicle retail sales are tracking at a seasonally adjusted annual rate of about 15.5 million units, the highest since before the pandemic, but that’s still well below the nearly 17 million new vehicles sold in 2019, which was down from the prior years.

Days’ supply of new vehicles on dealer lots and in transit rose to 76 days for all brands combined, according to Cox Automotive. Sales volume has been recovering slowly, amid way-too-high prices, but inventories have surged to 2.84 million vehicles, which caused the increase in supply. Not included are Tesla and EV startups; they don’t have dealers, and Tesla doesn’t even disclose US inventory or sales.

Supply had hit 80 days in January. Many brands have over 90 days’ supply, and a bunch of them have over 100 days’ supply, and a few over 150 days, that’s where the glut is. We’ll get to them in a moment. Supply of 60 days is considered “healthy.”

Days’ supply by major brand: The brands of Stellantis in red, Ford’s brands in light blue, GM’s brands in green, and foreign brands – though many of the vehicles are manufactured in the US – in dark blue. Stellantis has a mega-inventory glut on its hands; as does Lincoln. A bunch of import brands are chasing them higher. The bold black vertical line marks 60 days supply:

New vehicle inventories are up. Inventories of new vehicles on dealer lots or in transit rose to 2.84 million vehicles as of May 2, up by 51%, or by 961,000 vehicles, from a year ago, and the highest since December 2020, according to data from Cox Automotive. Inventories have now more than tripled from the worst moments of the shortages in the fall of 2021.

By comparison: In 2019, new vehicle inventory averaged 3.66 million vehicles. But dealers were overstocked back then, and sales were about 10% higher than what they’re tracking in 2024 so far, and automakers’ incentive spending as a percent of MSRP was about double the current rate.

Incentives are up — but not nearly high enough. Automakers are now throwing incentives at their dealers and at consumers. And their captive lenders are buying down interest rates. For example, Ford Credit is offering 1.9% financing on F-150s.

Average incentive spending per vehicle sold in April has jumped by 57% year-over-year to $2,633, or about 5.3% of MSRP, according to estimates by J.D. Power.

That’s a big increase from very low levels during the pandemic, but it is still far from reaching the incentives seen in 2018 and 2019 when average incentives reached 10% of MSRP (such as in July of both years). So clearly, manufacturers, other than Stellantis, are not quite panicking just yet, and they’re still just dabbling with incentives. They loathe giving up their big-fat pandemic-era profit margins.

Prices are stuck. MSRPs have gotten raised year after year, and now incentives are designed to stimulate demand, but those incentives are still not high enough to make a visible dent in prices – as measured by both: by the average listing price and by the CPI for new vehicles.

The average listing price of new vehicles in April, at $47,333, was up a hair from a year ago, despite the increase in incentives, according to data from Cox Automotive. In other words, all those incentives are doing for now is papering over the average increase in MSRPs.

The average listing price had soared by 26% during the pandemic. The spikes in the chart are the Decembers, a big month for new vehicle sales, when Americans buy each other cars for Christmas, or whatever (always followed by a plunge in sales in January and February).

A lot of sales can come out of the woodwork if automakers throw enough incentives at buyers, but they’re still not doing it enough just yet:

The new-vehicle CPI inched down for the fourth month in a row and was down a hair year-over-year, also testimony of just how sticky new vehicle prices are, even as the used-vehicle CPI sagged in a historic way, giving up nearly half of the pandemic spike. The new vehicle CPI has barely changed since March 2023 after the 20% price surge during the pandemic.

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  141 comments for “New-Vehicle Supply Turns to Glut for Many Brands. Automakers Roll out Incentives, but Not Nearly Enough

  1. Phoenix_Ikki says:

    Couldn’t have happen to a better company like Stellantis. Have fun being stuck with those $80-90K pickup or Grand Wagoneer or $70K Jeep. I must have miss the memo that Jeep Wrangler is consider a luxury vehicle….a lot of these is going to turn into lot rot real soon if not already.

    Stellantis is also badly botching EV strategy as well, a day late and a dollar short, now they are planning to go all in and release tons of new EV when the market is slowing down, doing so at the expense of ICE vehicles in their line up that people are still interested in….Good luck with that, guess not everyone can have the foresight like Toyota. No worries though, their CEO just got $39M pay package, maybe his pay is tie to how much excess inventory you can build..what a joke.

    • lpm says:

      Im waiting for my 12 k EV like what china is selling now. Poor musk, he lost China, America is next.

      • El Katz says:

        I think the current administration put tariffs on the Chinese EV’s…. IIRC, it’s 100% or doubles the price.

        • Tom15 says:

          They will be built in Mexico, and come across without the tariff.

        • Glen says:

          Politicians will go after Mexico if that happens. The only road to the WH currently is the rust belt and winning elections is more important than climate change. Should be interesting to see how much trade is destroyed. American consumers will likely be the losers unironically. Trade dispute mechanisms don’t work with regard to the US just as the other international courts have no bearing.

        • Tom15 says:

          Will believe it when I see it happen.
          No fantasy world here.
          The public heard 100 percent tariff and its a done deal.
          Lip service will be given about mexico production…and the public will move on to the next drama.
          Seems like only yesterday when the mean tweeter was getting hammered
          Over tariffs…….now it is hailed as a great thing.

        • grant says:

          Nearly impossible to “go after” mexican made cars: not only are they included in a comprehensive trade treaty, but so many existing brands already build there.

      • Richie says:

        Musk is riding along with the China ship, he didn’t lose. His Tesla shanghai factory is the turning point for Tesla, sufficent manufacture capacity and good cash flow. Even EU cars are teaming with the Chinese on EV now, JP and US are running their own kayak in this race.

      • Cole says:

        If you think China is able to sell those EVs at that price and be profitable, you need to think again. The Chinese government borrows and robs to subsidize the companies building them. They hope in this way that China becomes the only super power. This is the reason for the tariffs. Even if they get built in Mexico, they’ll still be hit with tariffs. If the current tariffs don’t specify Chinese companies, they will. And if you still want one of them knowing that doing so supports the CCP, I don’t know what to say.

        • eg says:

          The “funny” part is how complicit US corporations were, shipping their production overseas and happily contributing to the damage wrought by abandoning entire towns and manufacturing in pursuit of short term profits for more than 30 years now. Congratulations, I guess?

        • Richie Richie says:

          “The Chinese government borrows and robs to subsidize the companies building them.” Funny the US used to do that as well, now they use that kind of money mostly to bail out the wallstreet gangs.

      • Massbytes says:

        Through April 2024, Tesla China sales only look to be about 4 percent behind 2023 and May 2024 is looking strong for them. That is hardly losing China. I doubt you know America is “next” either.

      • Charles Henry says:

        I had the privilege of driving the Chinese Seagull – the electric car from China. I liked it. Reminded me of the eighties when American Car Manufacturers rolled out those small 4 cylinder cars, the Monza and such. It’s not a Pinto or Chevette, it seems alright for 12,000 dollars. The problem is that the Chinese Military helped engineer the vehicle and now the Chinese Government subsidies the Chinese Company. Hell… it worked quite well with Televisons. I love the ICE and I have many of them, mostly old stuff but some newer. I even have a couple EVs for the novelty. Look Out Big Three. As my grandfather said often, take your vitamins, which meant we will live to see a completely diferent GM and Ford, Stellantis thanks for bring back the stick in pony cars and not bad with those Hellcat engines but you will be missed… by me a great deal. In my work I see just about ever consumer with an 800 dollar car note, how can that be good for anybody. If their car note was 150 dollars on their 12,000 dollar golf kart, that would be better for them. American Cars, like so much of our past – small town drug store, family farms, supper clubs are a thing of the past. The American Car will join them shortly. I will miss them… not many others I imagine will.

    • Felix_47 says:

      The CEO of Toyota gets 6 million. The CEO of GM 20 million. Clearly there is no link between what a CEO gets and how worthwhile he/she is….not in the US……the land of freedom and free enterprise.

      • 91B20 1stCav (AUS) says:

        Felix – the general disparity in compensation between upper mg’t in Japanese and American corps. is longstanding and well-documented (as is the disparity in compensation between the highest-and-lowest-paid positions in said corps.)…

        may we all find a better day.

      • James@58 says:

        Full size Tundra worth the high price because of the reliability, not anymore. Climate BS that forced the twin turbo V6 replacing the V8 has a developing problem. Spun main bearings causing many blown engines before 50K.

  2. Warren G. Harding says:

    Batteries in EVs are warrantied for 10 years, 100,000 miles. No one is buying a used EV and throwing in a new battery.

  3. Home toad says:

    A new car, a new house, not for me. I’m going to save my money, live under the bridge and walk. When I’ve saved enough I’m moving to a different country, live by the sea and catch fish and play my flute. I might even Marry a girl.
    47K for a car…What !!, after payments it’s more like 60K, then I have to put gas in it for it to work?.
    I’ll let you all know when I’m leaving.

    • Debt-Free-Bubba says:

      Howdy Home Toad. Thinking about a Sailboat?

      • Home toad says:

        Get your boat and be gone…. Bring back some brains if you find any.

        Back to the car thing.
        Reading comments here, the Chinese are going to save the day with the 12K car, and it’s electric. We’re screwed, better learn Chinese or Spanish. Do we make anything in the US anymore, I know we make houses for a half million and cars for 50K, we also make millions of beggars, I see beggars on every corner, we’re good at making beggars “can you spare some change”? No.

        • Debt-Free-Bubba says:

          Howdy Home Toad before you go to the beach and play music, there are new vehicles around 20, 000.

        • Flashman says:

          I tried that once in Australia, that life sucked.

    • Nevermore says:

      your money saved is being decimated too so chose your poison, buy a car and enjoy it yourself or keep the money in the bank and let the government take it little by little.

    • Charles Henry says:

      EXCELLENT… I agree, but are we allowed to call them ‘girl(s)’ today?? We best becareful…

  4. Debt-Free-Bubba says:

    Howdy Youngins. Now that ZIRP is dead, you should see car manufacturer interest rate incentives like the building industry The Lone Wolf taught you about.

    • A A Ron says:

      Tesla is offering 0.99% on model Y and slashed FSD subscription in half

      • Debt-Free-Bubba says:

        Howdy A A Ron Whats a Tesla?

      • Wolf Richter says:

        Back in the day, Ford Credit and others occasionally ran 0% financing specials. Still waiting for that.

        • Dirty Work says:

          I remember GM offering 0% after 9/11.

        • Phoenix_Ikki says:

          I’ll bite if Porsche or Corvette Z06 ever offer 0% interest….a man can dream…

        • Debt-Free-Bubba says:

          Howdy Lone Wolf YEP, O % or cash back. They would run those incentives almost every fall before the new model year vehicles.

        • Louie says:

          0% and cashback.

          Rarely was 0% a good deal as it usually required paying sticker price. Also, many dealers added on un-necessary high margin “improvements”. (paint protector as an example)
          Cash back. I loved that one. “Give me all your money and I will generously give you a small portion of it back” That had to be the biggest marketing scam of all time.

        • Dan says:

          I’m still driving a 2015 Fiesta ST I got for $22k, $0 down, and 0% interest over 7 years. It’s about time for another deal like that.

        • El Katz says:


          0% never “required” paying sticker price. 0% was for qualified buyers who negotiated any deal. The “requirement”, as you put it, was likely due to people falling victim to the “Four Square” which sucks naive payment buyers into the automotive version of three card monte.

          Cash back? Usually offered as a discount and funds provided by the manufacturer to the dealer. When the manufacturers get down to rebating profit to maintain production/plant profitability, market conditions are becoming dicey. The truth be known, the “cash back” advertising was designed to keep the dealer from stealing the money….. preventing it from getting to the desired recipient – the customer. Without advertising it, you still have the profit drain but with a greatly reduced impact on the volume.

        • Debt-Free-Bubba says:

          Howdy Louie. It was O% or Cash Back, not both. I would save a few thousand dollars and purchase bare bone pickup trucks. No radio and once purchased a 79 GMC that had no radio or a/c. Brand new trucks that would last over 20 years with a depreciated business lose too. Today you have to order a bare bone vehicle or pay for satellite radio.

        • TulipMania says:


          Do the car manufacturers have sufficient free cash flow to self fund 0% financing– or would they need to issue corporate bonds, and use the proceeds to do that?

          Any insights as to how, when what why the next steps will be/play out?

        • Wolf Richter says:

          The “captive” finance companies, such as Ford Credit, securitize their loans and leases and sell them to investors; and they also borrow by selling bonds to fund the loans they keep on their balance sheet. So funding for these loans is sort of unlimited.

          They get to 0% by using the incentives that the parent company (such as Ford Motor Company) would normally throw at the buyer. This is why normally if there is a 0% promo, they offer an alternative of “cash back” or similar if a buyer doesn’t want to finance. So dollar-wise it works out about the same.

        • Ross says:

          I got 0% financing on my 2011 Toyota Camry. 5 years same as cash. End-of-model-year slight discount of $1K or so off sticker. Was worth it for the blue exterior with tan interior, very hard to find. It was buried three rows back in the excess inventory lot, like they were trying to hide it. “Hey! I want that one!” Took them 20 minutes to get it out. Saw this piece that mine is now almost exactly average:

      • lpm says:

        Thats cuz China now has an EV for 12k. Musk has alot more to slash to catch up with china.

        • Glen says:

          When the tariffs were 25% that would have been around 20K. Now that tariffs are going up obviously a lot more. Everyone talks about the EV tariffs but they are broader in scope and could cause supply chain disruptions again which could lead to more inflation.

    • Slickfish says:

      Are the interest rate buy downs on auto’s calculated in the incentive number? They are not calculated as such on the buy downs by home builders if I remember correctly.

      • El Katz says:

        It’s not a buy down per se…. it’s whatever the rate is offered x’s amount financed. Often the reduced interest offers are capped at various terms (.9 for 36: 1.9% for 48: 2.9% for 60, etc..) The rates are not usually stairstepped (in other words, if you go for a 60 month term, your rate is 2.9% for the entire term).

  5. Gabe says:

    The disgusting asset bubble will crest before the end of summer. Fall will be had, quite literally. Save your pennies.👌

  6. TulipMania says:


    Do you think this will negatively affect TSLA? It would seem that if competitors cut their EV and/or hybrid prices, that it would put downward pressure on earnings.

    • Wolf Richter says:

      Tesla instigated the price cuts over a year ago. And it cut by a lot and several times, and obviously it reduced its gross margin — the highest among the major automakers at the time — by a lot, but it had big fat margins and had a lot of room to cut. Now there is less room to cut left over unless it makes further gains in cutting its production costs.

      Hybrids are more expensive to build than ICE vehicles and EVs. So they do not have a cost advantage over anything. Hybrids are an option that customers pay extra for. Toyota will make its Camry hybrid only. I assume this manufacturing simplification — not having all these different powertrain versions — might shave some costs off the hybrid Camry. Hybrids are great, but they’re an expensive complicated vehicle to build.

      • Brad says:

        A new Camry hybrid will cost less than any new Tesla.

        • Wolf Richter says:

          A Camry Hybrid is a front-wheel-drive slow-poke sedan with good gas mileage. The lowest-end Tesla is a near-luxury rear-wheel-drive sports sedan — same category as BMW 3-series — that will blow the doors off the Camry Hybrid. Apples and oranges. These silly comparisons really get to me.

      • Grant says:

        Any response for Elon’s statement of “tesla automobiles will be appreciating assets” 😁

        • Wolf Richter says:

          Well, pieces of crap 1980s Ford Mustangs had become appreciating assets during the money printing era, though prices are now falling. You never know how crazy it can get out there once people go ingo a mania.

    • lpm says:

      Im waiting for china to bring their 12k EV to the USA. even with 27% tariff it is still the best deal out there.
      If musk were smart he would bring the 12k EV from china and slap the TSLA name on it.
      He could still make a fortune since he is not building anything

      • El Katz says:

        The tariffs are now/soon to be 100%. Announced last week.

      • Hubberts Curve says:

        I think to talk about a 12k E one needs to consider the battery. A large portion of the cost of an EV is the Battery. Many of the battery upgrades for a Tesla ( to get more mileage) cost more than 12K. The batteries are an international business with raw materials and supplies coming from all over the world. My guess is that a 12K Chinese car would have a small battery with no thermal conditioning, that would be unacceptable in our market.
        They could easily. make a 12K Ev today for the American market. A fiberglass, topless cousin of the Meyers Dune buggy, with a 50 mile range, one motor, and webbing seats. Come and get em.

    • Thunderdownunder says:

      If you had purchased a vehicle in the last 6 months the below would make you furious as you burned real cash through the repricing and depreciation
      Tesla in Australia have cut prices twice in a month. You can now buy a Model 3 for the same price as a Toyota Rav4 .
      also Stellantis have cut the prices on all Jeeps with the Grand Cherokee dropping $28,000.…. Stellantis other lame brands down here Ram Dodge Peugeot, Alfa Romeo have had similar cuts.
      You would be crying as the cash ignited.

  7. Depth Charge says:

    Another bloated price bubble set to implode. Ram truck inventory is through the roof. I am now getting emails and cold calls from dealerships who haven’t hit me up in years. I ignore them, but in the odd event I accidentally answer the phone I’ll be telling them to not even bother calling unless it’s 50% off, and then I might think about it. You can take your $100k POS and shove it.

    • lpm says:

      even 50% off is not enough. it is a freaking truck.

    • Carl says:

      Here is what everyone forgets…all those people that bought new cars in the past 3 years and paid way too much due to add ones…often 10k tacked on may never be able to afford another car as they are seriously upside down. Better hope that car will last many years as those that paid too much (and financed…ie…poor people) are screwed now and when they go to trade in or sell. All this is good for us cash buyers!

    • Lili Von Schtupp says:

      Local Ford dealer’s been mailing me offers weekly for two months. I can upgrade my current model to a 2024 for only $100/month more for 72 months. But don’t ask the full price, they only reveal the monthly payment. And, please please please come in for maintenance.

      My warranty’s up very soon but they seem to think I’ll be taking it back to them to change oil. First time I took it in for covered maintenance, they stole the tool kit out of the trunk and the rear brakes have squeeled horrid ever since. Now that they want to get their grubby hands on it for a warranty-expired trade in on another overpriced pos, they can kick rocks.

      Ford: At least they circled the problem.

      • Heff says:

        I still shake my head in wonder at all the people who buy the payment and could care less about interest rate, price etc…Probably same guys who were living off their heloc years ago.

  8. Spiceoflife says:

    Stellantis. Their decision making seems so out of touch with reality. sometimes it reminds me of the kids book where Curious George the monkey turned up the speed on the factory and products just started blasting out the end nowhere to put them.

  9. My God! It's full of cars! says:

    I have a laydown yard about 1 acre that I rent to builders. A big dealership (Stellantis) down the road wanted to use my yard to store excess cars.
    So, we were negotiating the deal, then nothing. No biggie.

    Then, I found out that they needed a larger yard and rented out a 3 acre lot. I drove by it and it was full of cars and trucks. So, I believe that 150+ days of inventory.

  10. Mitchell says:

    I know you have a lot of experience in the industry Wolf, but qualifying 60 days as “healthy” is blowing smoke. Not saying it’s wrong, just not data. It would be nice to see a 10 year average of days of inventory (covid screwed up all the numbers over the past 4+ years).

    Same covid based timeframe problem with the total inventory numbers. 2019 makes it look like 3.5M might be a reasonable inventory number and we are a ways away from that. The glut caused decline/bust might be a ways off yet, though interest rates might be slowing sales action compared to ’19. Fun times – I keep putting off my pending purchase.

    Thanks for all your great articles Wolf, and everyone should support Wolf’s spring fundraising/support drive.

    • Wolf Richter says:

      If you run a dealership with 90 days on the lot, you’ve got too many and you need to run some massive specials and advertise out the wazoo to get that down. Your floorplan will start eating you up. And 90 days’ supply means that lots of cars sit for a lot longer than 90 days because some go out the door within days of coming off the carrier. Nothing but problems when inventory gets old. So you strive for 60 days, and when you fall below, you feel pretty good, but you might be out of some stuff. But you might be out of stuff when you have 120 days’ supply because a lot of times, you have the wrong supply.

      If you sell 330 new units a month, 90 days’ supply is 1,000 new vehicles! That’s a shitload of new vehicles to have on the lot.

      2019 was pretty rough, and we covered it back then obviously under my infamous “Carmageddon” label. Inventory everywhere, sales down, incentives hitting highs, etc.

    • C says:

      60 days is healthy for a well run dealership. Not all dealerships are ran well, but as someone who knows the finances, I agree with wolf. 90 is needs improvement, 120 is needs new management.

    • El Katz says:


      60 days is “not blowing smoke”. It’s a broad stoke measure of inventory health. Day’s supply is somewhat inaccurate as it’s easily fooled… If you sell one certain model of vehicle per month and have three in inventory is it truly a 90 day’s supply if they’re both poorly equipped? No. Plus, if you have a monthly volume of 1 and sell two in any particular month, your day’s supply drops to 30 if there’s none in the pipeline.

      The key is to track days on lot and move the dogs before they grow roots into the pavement. Very often, you’ll find the dogs lined up on display near the showroom to keep them in front of the salesmen. Otherwise, they get pushed against the fence and rot.

      • mitchell says:

        Maybe blowing smoke was a strong way to word it, but I try not to use people’s opinions, generalizations or even consensus to formulate an understanding of something. Even though I have read some of Wolf’s writing, and have solid reason to see him as an expert on this subject, I like to see hard numbers (with sources for those numbers). I would argue that historic hard numbers are much more useful than what is considered “healthy”, “normal” or “well run”, if one it trying to get a feel for the sum of directional forces in a complex system.

        Of course, much of Wolf’s writing is presentation of pretty hard numbers in a level headed perspective. The two supply charts are an example of this. They just don’t go far enough back to cover for the covid noise. Wolf’s response with reference to 2019 “Carmageddon” was a great lead to dig deeper.

  11. Inflation Termites says:

    Toyota shining through six sigma and reliability excellence. I participated in many kaizen events over the years, America’s big 3 still don’t understand the concept of sustainability. I wonder if leasing programs will become more appetizing to those who want to enjoy more of their disposable income, even at 120 month financing, the numbers don’t make sense. “You pigged out when the pigging was good.” The used car market will continue to be on fire, the new high mileage is 150,000. So many folks are grasping after later models, driving them to failure.

  12. grimp says:

    A temporary supply disruption results in permanently 30% higher prices. Yeah makes sense.

    • Gattopardo says:

      It does when the dollar lost 30% of its real world purchasing power, more or less.

      • El Katz says:

        …. and government equipment mandates (like backup cameras), driver’s aids (active cruise control, lane departure, collision avoidance braking, blah blah blah) add to the complexity and standard equipment levels…. Those aren’t free.

  13. SoCalBeachDude says:

    Have these vehicle makers taken a good hard look at their vehicles lately? Who do they think would want any of that junk even for pennies on the dollar? How hard is it for them to get a clue?

  14. Midwest Ralph says:

    We are looking to buy a car sometime in the next two years. Should I give Lincoln a glance?

  15. fullbellyemptymind says:

    I’ve made a lot of money in automotive finance but I’ll never understand why reasonable people would spend $47k (on avg) for a depreciating asset that sits idle 95% of the time. Everyone’s situation is different, we’re all special in our own little ways, but the average vehicle is driven an hour per day, with the vast majority of individual travel between just 3-5 locations.

    If you’re just a car guy (person?) then I kind of get it. You change your own oil, put on different tires in the winter, spray stuff on your dash. You just like cars, great, whatever makes you feel good as long as you’re not hurting anyone. I’m not a car person, but I like oddly configured bicycles and McIntosh stereo equipment – my collections of each sit idle nearly 100% of the time. No judgement on the car people among us intended.

    But if you’re not a car person, then you own a mobility device which, if bought new will set you back $47k and be worth half that in 3 years (and half that again in 3 more…). That’s an absurd financial decision when the utility of the purchase if fully considered. It’s an overpriced Bird scooter that you take to the office and back.

    Don’t buy a new car, ever. But certainly not at these prices. You don’t need a new car. No one does. And I say this as a businessman who makes a spiff of some sort on many (most?) of the new unit transactions in the US and Canada. Do yourself a favor; buy a 3-5 year old CPO. I always recommend the historically Japanese OEMs, but everybody is putting out quality ICE* product these days so you can’t really go wrong if you do a minimal amount of research. *I’m not slagging EVs, but excluding Tesla I don’t think we have a quality consensus on current gen EVs.

    I could drive just about any car I want. I could get it directly from the OEM at a price that is only available to people who don’t need discounts. I drive a 2015 Honda Accord V6 with a manual transmission that I bought used. And it’s still just an overpriced Bird scooter that I take to the office and back.

    • Wolf Richter says:

      🤣 You clearly don’t feel the American car culture rushing through your veins. If everyone thought like you as of today, lots of car companies would be bankrupt a year from now. And we’d probably be better off longer term. But that’s not the American way. Vehicles are so much more than transportation devices in this joint.

      • Phoneix_Ikki says:

        Sadly this is the way in this country, more so than probably anywhere else on earth….this “car culture” is also why you see plenty of douchebag truck owners driving a Raptor as a personal statement rather than having a true need for a truck…

        • Marco says:

          “Sadly this is the way in this country, more so than probably anywhere else on earth”

          Not really. It’s the same anywhere you go. In Eastern Europe everyone wants to drivr Mercedes, BMW, Audi. Not everyone can afford it, but everyone wants one.

      • Ben There says:


        I owned a service company and over a 12 year period purchased 24 Ford F-150 bucket trucks. As you are aware, the diesel engines in the large Ford trucks (6.4L and 6.0L in the early 2000’s) had massive failures. These failures did not show up immediately.

        Ford did not stand behind their engines unless the failure was during the warranty period. With a heavy duty diesel that was supposed to last 200,000 to 300,000 miles, this was a massive problem. Their warranty period was way too short.

        Ford almost bankrupted many of us in the services industry. I am not here to bash Ford, but my entire worldview of the auto industry changed by this experience. There is no way to repair the damage caused by providing such poor quality.

        I did have the “American car culture rushing through your veins”, but not anymore. My loyalty was not only not rewarded, but cost me hundreds of thousands. This is not an antidotal experience with one vehicle, but all of us who bought the Ford F550s and F450s suffered huge financial losses. With a Terex man lift installed on one of these trucks, the engine was not the major cost, but without the engine, the truck was worthless. When you then have to replace every engine at 60,000 to 80,000 miles, it crushes you.

        I know everyone has different transformative experiences in their life, but this experience transformed how we conducted business from then on. Our loyalty ceased to exist.

        This post is not meant to denigrate Ford, as it has happened in hundreds of industries and with thousands of different products. I’m sure everyone on this forum could share a story of their own “lemons”. But that is the point. Everybody has had similar experience with vehicles, appliances, computer equipment, and on and on. When quality is not provided and companies do not stand behind the product, cynicism sets in.

        Brand Loyalty rarely exists in America, and that loss has been largely deserved.

        • Wolf Richter says:

          “I am not here to bash Ford, but my entire worldview of the auto industry changed by this experience”

          I’m with you. I can say exactly the same thing by having run a big Ford dealership for a decade back in the day (and we had a Ford heavy truck franchise along with it). I have said for decades that the people that run this place cannot manage themselves out of a paper bag.

    • Mongolian Conqueror says:

      TLDR. But, I agree about buying used cars. Unfortunately, most old cars are priced almost the same as new ones. Plus with used ones, you take on the risk of a malfunctioning car since resellers buy anything now. They might even be makin short term fixes to cars with major problems, i.e. just enough to work fine for 2-3 months. At current prices, used cars might not be worth the risk if you have small kids and travel a bit by car.

    • HowNow says:

      FBEM, I agree completely. The “car culture running through your veins” is about the same “ass-pirational” buying of a LV purse, or a Gucci piece of luggage, or a Rolex. Same bullpucky, different gender.

      (Sorry, Wolf. It’s not only testosterone; it’s also estrogen.)

    • Louie says:

      Fullbellyemptymind: You deserve a Pulitzer Prize for this world class piece of advice!

      • El Katz says:

        People who have been in the car business (or associated with it) know not to buy new. The first new car that I have purchased in 32 years is presently sitting in the garage…. and I bought it at a price not available to the general public. I bought it when used car prices were still stupid (I lost $3K on a vehicle I drove for over 6 years).

        Buy used – but still under warranty – and then go online and buy a manufacturer sponsored extended warranty. You don’t want to own any of these computers on wheels naked. One busted connection in a wiring harness buried deep in your vehicles interior will demonstrate why. People don’t realize that their entire vehicle operation is mostly interconnected and a failure in one area can disrupt the operation of multiple components. (Who’d have thought a failed Bluetooth module would mess with the HVAC controls?)

        Direct injection is another reason (carbon buildup). Turbos (high heat and bearing failure). CVT transmissions. The extended warranties available through a franchised dealer online can usually be had for $100 over the dealer’s cost. I live in AZ and bought mine in North Carolina. The key is “manufacturer sponsored”, not Car Shield or some other fly by night operation. Then you just pay to replace fluids and consumables. Cost me about a grand and the first repair (leaky fuel rail) brought that to zero. The rest of the work done was free to me, and even provided a rental for nada.

        • HowNow says:

          I tried that but the dealer required a $300 end-to-end inspection before giving a warranty. Is that normal? It seems reasonable but maybe not.

    • Debt-Free-Bubba says:

      Howdy Emptymind. You are not business minded I take it?

      • fullbellyemptymind says:

        Hell Bubba – by the standards of this chat group I’d probably qualify as a card carrying socialist. Paraphrasing Damon Runyon – If I die with more than ten grand in the bank something has gone terribly wrong.

        I guess that’s the point of my overlong screed; less consumerism -> better world. Or in this case, fewer new car sales = lower new car prices = lower used car prices = (insert your version of a slightly better USA here).

        Or as Wolf put it above with Hemmingwayesque succinctness – “…we’d probably be better off longer term. But that’s not the American way.”

    • ApartmentInvestor says:

      I’m a “car guy” (who changes his own oil and installs studded snow tires on steel rims on my SUV at the cabin every winter). I grew up in a family that has never bought a new car and while I have personally never bought a new car but I have found that for people that put a lot of miles on cars and don’t do any work that a (simple, affordable) “new” car is probably a better bet than a CPO (30-50K miles) version of the same car. The a reason that car rental companies and most fleet users with sales guys don’t buy CPO is because a new car costs less. For a senior who does not drive much the CPO Accord that costs less will most likely have a lower cost over the life of the car.

      • fullbellyemptymind says:

        For clarity – I wasn’t using the term “car guy/person” in a derogatory manner. Two of my favorite people in the world are car guys; my son and my mechanic. It was just a catch-all term meant to differentiate those with a genuine passion for automobiles from the rest of us with simple mobility needs.

      • Nobody says:

        “I’m a “car guy” (who changes his own oil and installs studded snow tires on steel rims on my SUV at the cabin every winter)”
        Most of you included yourself are better off with dealer service. You guys have no clue how to change a timing belt.

    • Gaston says:

      Not everything is a financial decision. Some people work for money to use to buy things they like, which may be purely design based and not typical car guy.

      Same with houses. You can build a square no design shelter from the elements place, or a highly unique architectural design piece.

      You can get the most functional, lowest life cycle cost clothes, or get stuff you like the look and fit of.

      All your choices. Why does anyone care what the other does and likes?

      • ApartmentInvestor says:

        I don’t “care” what others do, but it is interesting when people are exposed to other views. Many that focus on just “purchase price” might “think” they are always coming out ahead buying used if they ignore the cost of keeping an older car on the road (especially in places like the Bay Area where many repair shops are charging over $200/hour) just like many think a CD is always a better investment than a rental home if the interest rate is higher than the cap rate when they ignore the (tax free) appreciation of the home over the years (a Bay Area rental home I owned went up in value by an average of about $3K/month from 1994-2004 before I did a 1031 exchange into a 30 unit apartment building outside the Bay Area with a MUCH more cashflow).

        • Happy1 says:

          Lots of older cars are nearly maintenance free. I’ve got an 03 Tacoma and an 07 4Runner that between them haven’t had 2K of cost other than oil changes and gas. People should buy reliable vehicles and keep them for 2 decades.

          Regarding CDs vs rental property, rental property is an almost sure path to wealth because of tax advantages, especially appreciating markets, but it is hardly a passive investment and there is tenant risk especially in CA where many landlords went unpaid for several years during the pandemic. It’s a great way to build wealth, but for already wealthy people, there are easier ways for passive income for sure.

        • 91B20 1stCav (AUS) says:

          …so, how well one can determine functional value/life of their purchase…

          may we all find a better day.

        • Nobody says:

          You buy used if you can get greasy fingers and fix the car. I got a 2004 Pacifica with 250K miles on it.

    • BobC says:

      Don’t buy a new car, ever? Oh, please. I drive a 2015 Mustang V6 that I bought brand spankin’ new for a good price. It’s one of the best purchases I have ever made in my life, and if I wanted to sell it, Carvana would pay me over 50% of the original purchase price. Remember, driving a new, reliable car gives a person peace of mind!

      BTW, good choice of daily driver. That’s a peach of an Accord.

    • eg says:

      I learned this from my father many, many years ago — buy used and drive them until “prohibitive to repair.” I made the new car mistake only once and won’t ever make it again.

    • MM says:

      As a Honda fanboy, I think those V6/6MT accords are wicked fun.

      Bonus points if yours is a coupe.

  16. Halibut says:

    I drive a very low mileage 2020 BMW Z4 ragtop. I have it because it’s fuel efficient. Someone has to save the planet ya know.

    Not buying anything new at current prices. It’s nuts out there.

    • Home toad says:

      Let’s say you bought a new car for 30K and plan on selling it in 15 years for 8K. You get insured and all and just let it sit in the garage, don’t drive it. It would cost maybe 7 dollars a day.
      That’s really not to much for a new car.

  17. Max says:

    Looking like the millions of vehicles on lots, not even at 2019 levels. Automakers aren’t stupid don’t oversaturate market with supply when you can still sell at these price levels with only slightly smaller margins. I wish we’d get to the point where deflation pops it head out where people hold off purchases cause they know/think lower prices are coming.

    • mitchell says:

      A big portion of people (maybe 2/3 – 3/4 ??) spend what they make. If they get a bonus, they buy something. If they get more income they spend more, and payments are as important as price. That slosh of covid money is starting to dry up a little, so buying is softening, but it will be loss of income (jobs) that will drive reduced consumption, not the possibility of a better deal sometime down the road. It’s dangerous to wait on the sidelines too long, as if history is any guide, more money supply is being loaded in the cannon, to be fired at the first sign of slowing purchases.

    • Kent says:

      Deflation and inflation, at this point, aren’t monetary issues, they’re media issues. As long as the media is screaming inflation, people will assume we’re in an inflationary environment and create inflation. Same with immigration. As long as the media is screaming to the world that “America’s borders are wide open” people will keep coming. Nothing can be done.

  18. James Richard says:

    This whole conversation is based on the predicate that there are vehicles worth purchasing. As for me, give me a brand new 1996 Chevy Cheyenne and I will fight my way to the front of the line to buy it.

    • Sactown says:

      Good point James, unfortunately the environannies have been running the show for too long in govt and we’re stuck with paying for a bunch of nanny features we have no interest in.

    • mitchell says:

      Go back a one more year and get TBI. Spider injection was pretty problematic. Ford made great trucks through 97 as well. They’re out there with low miles and good condition – just look to spend 15 – 20K. And travel to a dry, non rust climate, as both Ford and Chevy of that era rust!

  19. Nemo300blk says:

    New car dealers are stacked with inventory, as are boat, power sports, RV, and tractor dealers. They can hardly give away a $250-400K Malibu wakeboard boat. Malibu is owned by Brunswick.

    Regarding Toyota inventory, the Toyota broker I use on the East Coast also has dealers on the West Coast, and he’s advertising a spreadsheet full of stale new inventory in the PNW for $1000-$5000 under invoice—not under MSRP, but under invoice.

    So this glut is even affecting Toyota dealers.

    • El Katz says:

      Look carefully at the vehicles on that list that are “stale”. Loads and loads of pickups. The local Toyota dealer in Scottsdale, AZ has them stacked like cord wood. Odds are, a Pious (Prius) or other hybrid isn’t on that list.

      The “below invoice” is often a mirage. Which invoice are they showing? The front office one or the back office one? One shows a simple math and the other shows (usually encoded) the reimbursements from the manufacturer. While it might sound stupid, dealers have such poor impulse control that they have to keep information away from their own employees as they would give away the store in order to make a volume bonus. The sales manager rarely sees real cost.

      The selling dealers are likely just sharing the holdback, marketing allowances, and other funny money to unload inventory that is eating floorplan. There may also be some factory cash included. Keep in mind, dealers pay interest on that inventory, just like a retail customer – often a percent or two over prime. Manufacturer FPA (floor plan assistance) doesn’t fluctuate with the interest rate changes in real time. Dealers were getting fat on that when they had nothing on the ground and now it’s actually being consumed for it’s intended purpose.

      • Happy1 says:

        24 Tacoma is a disaster. 4 cylinder turbo? No thanks.

        • MM says:

          Wouldn’t that make more sense than a NA V6? With the turbo you get max torque at much lower RPMs, which I imagine is beneficial for a truck engine.

        • Max Power says:

          Nonsense. I follow The Car Care Nut for anything Toyota mechanical related. He has positively reviewed the new Tacoma and specifically addressed the new engine. He says it’s good and personally I trust him.

  20. GuessWhat says:

    Hopefully, this is a leading indicator of increased deterioration of US economy for a looming recession sometime in the next 3-4 quarters. There needs to be a very extended huge new & used car glut.

  21. Glen says:

    I wonder how much say dealers get with inventory. I know Gibson guitar used to be flexible but now require a large buy in and you don’t get a lot of say about what those are. The store I go to stopped carrying at one point. Easier now just to go to Sweetwater and pick out the specific one you want in some cases as they will have pictures and specifics of each guitar not just the generic model picture.
    When I got my car I really didn’t want a sunroof but it had everything else so I was like, sure, but typically I don’t like all the extras that I don’t use. Heated seats, electric tailgate, extra trims and such can drive the price up and just add things that you don’t use but can break. An easily replaceable and better quality tablet like screen would have been worth it but back in 2017 Toyota still had low quality properitary screens but life goes on!

    • El Katz says:

      Dealers have limited say in inventory. Vehicles are allocated based on production targets, component availability, dealer reported sales (determines their share of the “pool”), and they can make some tweaks in trim levels.

      Colors are often changed after the order is placed (usually to white) to meet plant emission standards. That’s why there’s an upcharge for metallics – to discourage ordering.

      Despite “just in time” delivery, orders for components are placed long before production is scheduled to occur. “Just in time” refers to when they arrive at the plant.

  22. PC says:

    $47,000 for a CAR? Guess I’ll keep my old Ghia for another decade or so…

    • Curiouscat says:

      PC – I wondered about that average cost figure too. I paid about $32,500 new for my 2023 Forester Touring (top model) using the Costco purchase plan. What are these people buying?

      • Biker says:

        Good luck with your CVT transmission.

        • Curiouscat says:

          I love it! Never understood the prejudice against it. I’ve owned 4 and never saw an issue.

        • El Katz says:

          Never had a CVT problem? Didn’t own it long enough or you properly maintained it and replaced the expensive rubber band at 50K.

  23. Sactown says:

    There is definitely no glut of a specific model 4runner I’ve been wanting for months

    • Gaston says:

      Did you now see the 2nd chart?

      • Sactown says:

        Yes I saw the chart, it confirms my personal observations. There’s another aspect to this though, so often the companies (often due to the heavy hand of govt) produce stuff that people simply don’t want. For example when I last was shopping for a wrangler rubicon I could not find a base model without all the ‘options’ stuck on it that drives up the price. Toyota is playing the same game, good luck finding a 4runner TRD OffRoad base model, no ‘options’ in white or silver in all of Cali for MSRP.

        • Happy1 says:

          Last model year for 4Runner, everyone is trying to get one before the new model and its inevitable glitches.

  24. Prof. Emeritus says:

    How much do the Japanese manufacturers benefit from the weak yen? Part of your costs shrinking 40% in 5 years seems like a major advantage. The Korean won is loosing value as well, but intuitively it feels like Toyota/Honda are boosted by the currency crunch rather than the kaizen/TPM/JIT/lean buzzword-sphere myth?

    • El Katz says:

      Weak yen primarily benefits the mother ship when the funds go back to Japan. A weak yen doesn’t help with local suppliers outside of Japan nor export of components/spare parts.

      One Japanese manufacturer (who will remain anonymous) relies heavily on U.S. operations to support their worldwide network. U.S. operations provide the bulk of worldwide profitability, as some markets are losers because they sell some products at break even or below.

      • Prof. Emeritus says:

        Well, some funds eventually have to go back if it’s a Japanese company with at least their HQ & development center located there. AFAIK both Lexus and Subaru are predominantly made in Japan, Mazda is also up there. Back-of-the-envelope estimates indicate that 30-40% of cars sold by Japanese brands in the US still originate directly from the land of the rising sun. The rest probably has a Japanese added value of somewhere between 20-80%.

    • Wolf Richter says:

      Prof. Emeritus

      “costs shrinking 40%”

      Most Japanese vehicles you can buy in the US are made in the US or Mexico. Hondas, which are made in the USA, have for years had the most US content of any brand behind only Tesla. Some production of Japanese models is made in Mexico. As everywhere, supply chains are global and go through China. The yen has very little impact here, in terms of costs. So Japanese brands sold in the US face roughly the same cost issues as other brands.

      But Japanese automakers get to translate their dollar-profits into watered-down yen, which inflates their yen-profits for local (not US) consumption.

  25. lj says:

    Tesla now offering 0.99% financing to me and other current owners.

  26. Cole says:

    I’m seeing at my local dealer up to $12k off GMC 1500s. The prices are still high considering it’s still about $10k more than what it was in 2017 to buy one similar in specs. I think now that most of the people with low interest mortgages that could afford to pay $1k a month or more for a car have bought them, we’ll see bigger discounts more frequently.

  27. James says:

    I will not buy a new vehicle,if given one would sell immediately!

    I will stick with me custon 80’s backwards 4×4’s ect.,tough on gas but easy and inexpensive to work on!

    Oh,and they run/look nice as hell,especially me custom built 4×4 Chevy van!

    I need a gas sipper will buy a 80’s deisel rabbit(40+around town)/70’s Toyota ect.

    • Michael Gaff says:

      The abbreviation is “etc,” not “ect., and it is “my, not “me;” still, you are dead-on right.

  28. Michael Gaff says:

    Get rid of all the computers, backup cameras, lane centering systems, etcetera, etcetera, etcetera, and build cars. I don’t need (or want) this crap.
    My 1937 Cord goes everywhere your $60,000+ piece of tech goes.

    My 1999 GMC pickup hauls all the mulch that your $60,000+ F150 does also.

    My least dependable car, a cute 2002 BMW Touring Wagon is my biggest headache.

    • Wolf Richter says:

      Thankfully, we all like something different. Thankfully, I don’t ever have to drive a 1937 death trap (keep that one in your airconditioned garage as an investment, rather than risking your life in, my suggestion). And thankfully, I don’t ever have to drive a 1999 model anything. I like my adaptive cruise control, backup camera, hill-start assist LOL, 48 mpg in the city when I drive, less when my wife drives (it’s a newfangled hybrid), airbags everywhere (likely kept my wife from being injured when she got rear-ended hard enough to where the 2018 vehicle was totaled….

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