You hear me talk a lot about the day’s supply of vehicles. Automakers and car dealers live and die by that number. For dealers, it tells them if they have too much inventory that they are paying interest on. For automakers, it directs them where to put their incentive spending. Most people in the auto industry still live and die by the 60-day rule, meaning anything more than that shows an excess of vehicle. Any number less than 60 means more vehicles are needed.
What does days supply mean? Simply, it is the number of days it would take to sell completely out of a particular model of car, based on the current sales rate, with no additional inventory coming in.
Why should you care? If a vehicle has a high day’s supply, those will be bargains. These vehicles will have the best incentives and the biggest dealer discounts. A low day’s supply means the complete opposite-fewer incentives and dealers hanging on to make the most money they can.
You’ll notice a trend in the vehicles with the lowest day supply: 9 out of 10 of them are made by Toyota. The company just cannot keep up with demand, and frankly they love having a low day’s supply. It keeps the brand relevant and sought after. The fact that they are by far the leader in hybrids, and didn’t jump on the electric bandwagon is really paying dividends for them.
Here are the 10 top slowest sellers as of the end of October and the day’s supply:
Here are the 10 top fastest-sellers as of the end of October and the day’s supply:
Source: CarsEdge.
Photo; Freeman Toyota in Hurst, Texas. Credit: CarPro.