It’s a way to estimate how many days of car stock dealers have on hand. If it’s high, cars are piling up and dealers may be more willing to discount. If it’s low, cars are selling quickly and there’s less reason to cut prices.
Toyota is one of the brands being compared in the chart. The host points out Toyota’s inventory is expected to sell through in about 37 days, which suggests less discount pressure than brands with higher numbers.
Honda is one of the brands being compared. The host says Honda’s days-supply number is higher than Toyota’s, which usually means dealers have more cars to sell and may be more willing to offer discounts.
Subaru is another brand in the chart. The host’s number (67 days) suggests more cars are sitting at dealers compared to brands with lower days-supply figures.
Cadillac is being compared in the same inventory-days chart. The host says it’s around 69 days, which usually means dealers have more cars to move, increasing the odds of discounts.
Kia is one of the brands in the comparison. The host’s number (74 days) suggests more inventory at dealers than brands with lower days-supply, which can mean more discounting pressure.
Chevrolet is another brand being compared in the chart. The host says it’s around 76 days of inventory, which generally means dealers have more cars to sell and may be more willing to offer deals.
The “industry average” is the typical baseline for how many days of car stock the industry has. If a brand is above that average, it usually means more cars are sitting unsold and dealers may be more motivated to discount.
“Consumer leverage” means how much power buyers have to get a better deal. If dealers have lots of cars sitting around, they’re more likely to offer discounts or incentives to sell them.
Dealers often borrow money to buy cars for their lots. If the cars sit too long, the dealer keeps paying interest, which makes each extra day more expensive.
The Dodge Ram is a large pickup truck meant for work like towing and carrying things. It’s commonly discussed because it’s a high-volume truck model. In this podcast context, it sounds like they’re talking about how long trucks stay in inventory before people buy them.
Jeep is the SUV/off-road brand being talked about. The hosts are saying Jeep’s parent group has been slow to bring prices down enough to get customers interested again.
Chrysler is a car brand included in the group the hosts are criticizing. They’re saying the brand’s pricing strategy left dealers with too many cars and made it harder to win buyers back.
“Day supply” is a way to measure how many days of cars the dealers have on hand. If it’s high, it usually means there are too many cars sitting around, so the company may need to cut prices to sell them.
This is talking about Stellantis, a big car company that owns brands like Jeep, Ram, Dodge, and Chrysler. The point is that they raised prices quickly during the pandemic, which hurt sales.
“Allocation” here means how many cars the factory sends to a specific dealership. If dealers won’t take allocation, they’re basically saying, “We don’t want more cars from you right now.”
Carlos Tavares is a top executive (CEO) at Stellantis. The hosts say he was replaced, and they connect that leadership change to the company trying to lower prices.
Person
Antonio Fallosa
Antonio Fallosa is the new CEO the hosts mention after Carlos Tavares. They say the company started trying to lower prices more aggressively under his leadership.
Mini is a car brand known for small cars with a more premium feel. Here, they’re using Mini dealerships as an example to compare how much inventory sits on dealer lots.
“Day supply” is a way to measure how long a dealership’s current car inventory would last if sales keep going at the same rate. If it’s 124 days, that usually means cars are moving slower than the dealership would like.
The Mini Countryman is a small crossover SUV from Mini. It’s bigger than some other Mini models, with more room for passengers and cargo. The podcast is pointing out that Mini has been relying on the Countryman a lot for sales.
CDJR is a nickname for the Chrysler, Dodge, Jeep, and Ram car brands. The host is talking about how those brands are dealing with too many cars sitting unsold.
A “production halt” means the factory slows down or stops building cars for a while. The host is saying too many unsold cars can force that kind of pause.
The Dodge Hornet is a smaller Dodge crossover. The host mentions it as an example of a new model that’s not moving quickly enough, which can lead to bigger discounts.
The Dodge Charger is a famous Dodge sedan/performance car. The host brings it up to illustrate that even big-name models can struggle to sell when inventory builds up.
The Jeep Wagoneer is Jeep’s bigger, more premium SUV. The host mentions it as an example of Jeep changing its lineup because sales weren’t strong enough.
A “crossover” is a vehicle category that blends traits of SUVs and passenger cars, typically using a unibody construction and focusing on comfort and packaging. The host uses it as a generic example of a product strategy (“the greatest crossover ever”) that still doesn’t guarantee sales.
“Day supply” is basically how long it would take to sell all the cars sitting on lots, assuming sales keep going at the same rate. If that number goes up, it usually means cars are piling up and prices or incentives may need to drop to move them.
Here, “incentives” means discounts and special deals from the automaker to make a car cheaper to buy. The point is that even those deals aren’t enough to sell the cars quickly.
The Jeep Grand Cherokee is a popular Jeep SUV, and Overland is a higher trim level. The host is using this specific trim to show that even expensive versions are getting large price cuts to sell.
The Jeep Gladiator is Jeep’s pickup truck, and Mojave is the off-road-focused version. The host is pointing out that even a rugged trim like Mojave is getting big discounts and staying on lots longer than expected.
“MSR” is the sticker price number the manufacturer uses as a starting point. If a deal is “off of MSR,” it means the discount is calculated from that sticker number.
Cox Automotive is a data and analytics company that tracks automotive market activity like inventory levels and sales trends. The host uses its “latest data” to argue that supply is building and prices aren’t moving fast enough.
Negative equity means your car is worth less than what you still owe on it. If prices drop, your car’s value can fall even more, making the situation worse.
It means the carmaker ships lots of cars to dealerships. If customers aren’t buying them, the dealerships end up with too many cars and prices usually get cut.
Acura is Honda’s luxury brand. The host is saying that when a model like the Acura TL starts selling poorly, Acura may lower the price and add features to get people interested again.
Incentive levels are the manufacturer’s discounts—like rebates or special offers—that lower what you actually pay. Automakers use them to help sell cars when inventory is piling up.
Average transaction price is the real-world price people pay for cars, not just the sticker price. It helps show whether incentives are small or big compared to the prices cars are selling at.
Here, “manufacturer” just means the car company that makes the vehicles. The point is that if the car company doesn’t offer good deals, the dealership has a harder time selling cars.
The host brings up Nissan as an example of a brand that’s selling more lately. But they argue it still isn’t selling as much as it wants because buyers don’t see the cars as high quality as some competitors.
The Jeep Wrangler is an SUV built for off-road driving. It’s popular because it’s designed to handle rough terrain and it has options that let you open up the cabin. People often mention it when talking about which Jeep models sell the most.
A “negotiation power score” is a way to estimate how much room there is to bargain on a car. If cars have been sitting for a long time, the score suggests you may have more leverage to negotiate.
“Days to play” is basically how long cars usually sit on the lot before they sell. If cars are staying longer than that, it’s a sign sales are slow and discounts may need to get bigger.
Stellantis is the big car company behind brands like Jeep, Dodge, and Ram. The host is saying Stellantis is trying to be more careful with discounts, instead of lowering prices endlessly.
A buyers market means there are more cars available than people want to buy. That usually gives buyers more negotiating power and can mean lower prices.
It’s a way to estimate how many days of cars a dealership’s supply would last if sales keep going at the same rate. If the number is high, cars are likely sitting longer; if it’s low, they’re moving faster.
The Subaru Outback is a very common family vehicle. When the market has too many of them sitting around, dealers often have to discount more to sell them.
Lucid is an electric-vehicle company. The point being made is that even with a well-off customer base nearby, some Lucid cars can still end up sitting unsold.
to address elevated inventory levels. High day supply at Salantis has become a familiar part
of the inventory narrative this year and highlights one of the market's defining
characteristics. While overall inventory levels may look balanced, supply is far from
evenly distributed across brands. We've talked about the nuance here.
Worth noting, even among brands with elevated day supply, incentive discipline appears to be
holding. Look at this. Jeep, for example, even with a day supply, twice the industry average
had incentive levels at 6.7% of the average transaction price in June, according to Cox
Automotive estimates, below the industry average of 7%. So let's just layman's terms here.
Yes. Jeep, yes, the manufacturer, yes, is screwing their dealers. That's exactly what's
happening here. And their customers. Okay. Jeeps throw a caution to the
wind, in my opinion here, because if they don't increase the incentives, which literally what
we just showed you is they have low... They're showing discipline.
They have lower incentives than the industry as a whole, even though they're day supply
inventory, which everyone... More than double. More than double, meaning they can't sell cars.
Yes. What happens? Floor plan costs, the cost of sitting on that inventory, go take a drive
down dealership row in your area, and you're going to see a CDJR dealership with a ton of
cars on the lot. And you know who's pissed off? The guys and gals working at that dealership,
because they're probably not making money. Oh, I can assure you. They're making money on the service
drive. Don't get me wrong there. Every time a service customer comes in or on credit...
The sales guys aren't making anything right now, or the sales department's not making anything,
because they're not getting any help from the manufacturer, big incentives like you're talking
about, or price reductions on MSRP. They did some of that, but not enough. And they're pretty much
just saying, screw y'all, in my opinion, figure it out. And so what Jeep is saying to their dealer
body, is up to you to figure out how to sell it. We're done helping you. We'll give you a 6.7%
on average as an incentive to sell it, even though that is lower than the industry average.
So that says to me, as somebody who spent 43 years in retail automotive, that says to me,
screw it. It's on you. You figure out how to get rid of it. You take the loss. We're not
biting the bullet anymore than we have. And at a certain point, I think what this is proving
is that for some brands, you can't lower the prices enough that even at a low price point,
make it appear as if it's an attractive opportunity for somebody. We know Nissan
sales have gone up. Their sales are up month over month for the last 678 months,
something like that. But they're still struggling. But then actually Nissan's a good example. Yesterday
we were watching the World Cup. And I think if I'm not mistaken, I saw Nissan talking about
0% financing for 60 months. And there was, I think it was a Jeep ad, and it was 4.9,
or maybe it was a Ram ad, 4.9% financing for 60 or 72 months. Very different offers.
Very different offers. One selling more cars, one isn't. Why? Because one's doing 0% financing
and the other's not. But at a certain point, if my point was going to be even though Nissan sales
have increased, they still haven't increased to the level that they would like because the perceived
quality of what it is that they're selling isn't as high as other Japanese brands. And I think the
same holds true for a number of those Stalantis products where the perceived quality of what it
is that they're selling, regardless of price, doesn't justify whatever that price is. And I think
the buying public is saying it's crap and there's not a low enough price point for me to buy that
crap. Hasn't the Wrangler historically been one of their best sellers? And here you go,
relatively, I can't believe I'm saying this, but relatively inexpensive, $47,560 Wrangler. And
look at this, Dad, they've got a discount at already $7,000 off the top. But the negotiation
power score from Car Edge is super high. Why is it super high? Because it's been sitting for 142
days and the days to play in this area is 154. 24 for sale nearby, but only seven have sold in
the last 45 days. They're just not, even on their more volume or better value vehicles, they're
just not turning over. And I do think we are going to see more and more discipline both in terms of
the incentives that the manufacturers put out there and also, Dad, production halts, doing
rolling schedules of production to reduce the amount of available vehicles because ultimately
they want to control their pricing power. That too. And I think the greatest discipline is being
shown by the consumers. Yeah, by saying no. By saying no. And I do a lot of media interviews
and when I get asked, well, what should people do today buying cars? And my response has become
mark and consumers need to be much more disciplined in what it is that they're willing to do, what
it is that they're willing to spend. They need to be much more disciplined in understanding
what their budgets really are and what they really can afford. And so, not only are
Stellantis products being more disciplined in how they're incentivizing their vehicles,
their customers are being even more disciplined than their brands by saying, no, and just walking
away. The price point, regardless of how much you keep lowering the price, is not enough to
convince me that that's where I should spend my money or better yet, that's not where I should
be borrowing money from so I can buy this car on a monthly basis.
Bringing you to the chat in just a moment before we do the overall landscape for the new car market,
it's kind of flat, meaning that last month the day supply was 78 days, this month it's
80.3s with 80 days. The total amount of vehicles for sale has stayed pretty much the same since
yeah, February of this year and the average price has stayed the same as well. So, the new car
market's kind of stuck in neutral, I would say right now. It's neither a buyers market or sellers
market, but the nuance and automotive, excuse me, Cox Automotive called it out too, the nuance is
by brand. The nuance is 100% by brand, like for example, and then it's even broken up by model,
like I'm thinking about Subaru for example, that I think if I'm not mistaken, didn't have a particularly
high day supply of inventory, 67. So, if you're in the market for a Subaru Outback right now,
you better, you better be getting a big discount off of MSRP because they're just not selling well.
So, I think being knowledgeable and informed, we're like a broken record on the show. Being
knowledgeable and informed about local market conditions, again, super proud. This is why we
built CarEdge on the car search when you're shopping for new or used cars, you get all the
market data to inform what's going on in your area, more important than ever before.
Let's come here to the chat. This is earlier in the show, thanks from the
D Reclamation Project, incredibly kind. Yes. I will buy you a coffee if you would like with this.
Speaking of low demand, I was at Scottsdale Fashion Square and there were 50 plus lucid cars in
the basement of the parking garage collecting massive amounts of dust. Many dealerships are
parking cars and empty lots and Mesa too. Yeah, well, and God knows, there's no better place
to collect dust than in the Phoenix metro area. This time of year, when the monsoon season and the
who boobs, who boobs, yeah, roll in and the dust storms are just unbelievable. What do you make
of Lucid having a bunch of cars sitting around? Haven't we seen Tesla do that too? Another EV
automaker just got Tesla sitting in various places as well? Yes. It's the same equivalent to what
we're talking about with CDJR. We don't get market day supply data from Cox Automotive on
Lucid or Tesla. It's the same thing. It's just cars sitting, not selling.
But we know, we know that in the month of May, what was it, Lucid sold 700 or 721 cars
not enough in a month. And there is a belief that there's a well-healed clientele that lives
in the Scottsdale area, Scottsdale Paradise Valley area. Definitely. Those should be the
buyers of this car. But apparently not. And there's a lot of brands that are having issues
and Lucid's one of them. CDJR is another one. CDJR is one. But what goes on? The good news for most
CDJR deals, for the most, this is the good news. The lots are large enough that they have enough
space to park all these cars, whereas for some brands, lots are small and they don't have extra
space. So that's the good news. The bad news for those CDJR dealerships is their floor plan costs
So I want to pull this back up. Dan from our community says the Lantz is better scale back
production. Otherwise, their dealers are going to start drowning in inventory, costing them lots
of floor plan money. Okay. So this is the call to action for the car edge community. If you are
going to go buy a car, regardless of CDJR or not, one of the things you can ask is, is this thing
costing you a lot in floor plan expense right now? If you say that as a customer, it just shows
you're knowledgeable. Because most dealerships do not pay cash for their inventory. They finance
it. Well, floor plan costs is the interest that they pay in a crew every day that the vehicle
sits there. If you go to a CDJR dealership, you should especially ask this question,
how much have you lost on floor plan already? I'll take it off your hands. What's the oldest
one you have on your lot? There's incentive there to see. The only problem with that is if you ask
the salesperson, they might not know. They might not know because they've probably only been there
for three weeks. Because any experienced salesperson who has starved over the last six,
eight, 10, 12 months, whatever it is, will have tried to move on somewhere else. So that a young,
fresh salesperson, a green pea, as they're called in the industry, wouldn't know about floor plan,
doesn't understand the concept of floor plan. The new car manager should. The general sales manager
definitely should. The GM would. So that it could be a situation where when you go to one of these
stores. You might be more knowledgeable than the people you're talking to.
Where you save to the salesperson, you might not be aware of this, but the longer a car sits,
the more cost and dealership to have it on the lot. Go ask your manager, which is the oldest,
one of whatever model it is that you might be interested in. And let me take a look at that.
Maybe we can each do each other a favor. I can take an older vehicle off to your lot
at a sizeable discount and help the dealership move an arranged unit. The new salesperson
might not be aware. But definitely the manager will. Again, today's show is brought to you by
caredge.com. Coming up on seven years now of working on this business with my dad, it's cool
what we get to do. It's really, really fun. Thank you, everyone that supports us. Back at caredge.com,
we have the car search. So if you're not using that, you absolutely should. We have our buying
services, whether it be our concierge buying service or the AI car shopper. We also have
Ask Car Edge, which I encourage everyone to play around with our research center dealer reviews
and to get it free. And excuse me, you can get a free consultation as well. For those of you
that are curious, we are back side by side tomorrow for one more show here in Washington, DC. So
thank you to everyone who tunes in. We really appreciate it. If you enjoy the channel, enjoy
the show, subscribe to it. It always puts a smile on our face. Leave a comment too. I read most of
the comments. Do you read most of the comments still? I read the comments every day. Yeah. So
leave a comment. Say hi to us. We'd love to say hi back. And let's go get some lunch.
Whatever you should. We're back tomorrow, folks. Love you. Love you too. Thank you,
everybody. Well, you don't have to say love you because we're not saying goodbye this time.
Like when we do it remotely, we have to. Oh, maybe, maybe I'll leave.
Or you say love you to. Love you. Bye.
About this episode
Inventory “days supply” becomes the episode’s main lens for why Ram, Dodge, Jeep, and Chrysler can’t cut prices fast enough. Hosts explain the metric as a supply-vs-demand gauge and use it to show how high days supply signals slow turnover, weaker bargaining power, and costly aging past 90 days. They connect oversupply to incentives, financing offers, and dealer floor-plan pressure—arguing MSRP cuts can also worsen negative equity for existing owners.
Today on CarEdge Live, Ray and Zach discuss the latest news on Stellantis. Tune in to learn more! Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com
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