We continued to see mixed signals in May, with ongoing supply chain issues clouding production outlook and demand for vehicles remaining strong – however, not at any price.
Inventory levels for new vehicles dropped slightly by 0.5% in May as continued production delays and stronger-than-expected sales demand led to another decline in inventory. Used inventory levels rose 1.8% from April, and overall inventory index levels are now up year-over-year. However, this increase in used inventory is due to a shift in higher vehicle prices and a consumer market that isn’t willing to pay those prices, which is leaving more vehicles on lots.
The average listing price for both new and used vehicles continued to increase in May, up 1.1% and 1%, respectively, and both are seeing even higher gains year-over-year, with new up 40.3% and used up 49.1%. These increases in average listing price highlight the shift in the inventory mix and that consumers are prioritizing vehicles under Can$30k, which is putting upward pressure on the average listing price.
Further highlighting the disparity in the market is days-on-market, with new and used up 7.7% and 4% from April, while remaining down 16.8% and 17.9% year-over-year, respectively. Demand for vehicles remains, as highlighted by the year-over-year declines in days-on-market – however, that demand is highly focused on vehicles under Can$30k as vehicles priced above that sit for longer and are starting to pull up the monthly average as the overall inventory mix shifts.
For more insights, download the May edition of the Vehicle Availability Index & Insights Report.