As supply chains began to slowly mend in 2022, automakers poured the limited parts they had available into high-content, high-priced vehicles. High-end trims accounted for about 56 percent of inventory at the end of 2022, compared with 40 percent in 2021 and 17 percent in 2020.
“That’s a business decision to be made and a financial decision to be made but there are consumer-oriented repercussions to that, and I think that that’s where there are still lessons to be learned,” Wainschel said. “As they get more parts flowing in, [automakers] are looking to balance out their trim mix toward the middle and lower end of production to better meet the needs of consumers and not price them out of the market.”
Imbalanced trim mixes have put upward pressure on the average price of inventory, which has risen steadily since September 2022. The average marketed price of vehicles in April 2023 was more than $50,000 for the first time ever, according to Wainschel.
Meanwhile, the average turn rate slumped in the last quarter of 2022 and has remained below 60 percent in 2023, compared with more than 80 percent in the beginning of 2022.
“Part of that is a reflection of inventory going back up, but part of that is people being priced out of the market,” Wainschel said.
Wainschel expects to eventually see a new normal in which inventory hovers around 2 to 2.5 million, the trim mix begins to balance out and the turn rate is closer to 40 or 50 percent.
