Despite what at first glance appear to be astronomically high days' supply rates, automotive inventory levels have shrunk dramatically as nearly two months of suspended production and continued sales begin to eat into dealer supplies.
Cox Automotive estimates total U.S. inventory at 3.3 million vehicles, down about 440,000 from a month earlier and down about 700,000 from the same time a year ago. April's abnormally low selling rate — a result of closings or limited sales operations at dealerships because of the COVID-19 outbreak — puts the corresponding days' supply estimate at 121 days, 45 days higher than a year ago.
Light-truck inventories have dropped to just more than 2.5 million, down about 16 percent from the year-earlier period, while car inventories have dropped 25 percent to less than 790,000, Cox estimates.
If efforts to restart manufacturing run into problems, the aggressive incentives that have driven some sales could dry up as inventory levels dwindle, Cox says.
The Automotive News Data Center compiles inventory data from the Asian automakers and Volvo, which continue to report monthly sales.