As vehicle availability continues to challenge both dealers and car-buyers, CarGurus is happy to introduce a new monthly report from our Director of Industry Insights & Analytics, Kevin Roberts. The UK Vehicle Availability Index & Insights report will deliver his in-depth research and outlook for the coming months.
While a recovery from COVID’s direct impact on the economy & industry is challenging, the addition of the global semiconductor shortage has created a further headwind. Though this lack of chips is directly affecting new vehicle availability, there is a trickle-down impact on used, which is increasing in size as the stock shortage lingers.
For July, we witnessed a slight increase of 0.3% in used vehicle inventory compared with June. However, in some positive news, the number of available vehicles is up nearly 9% from COVID-impacted levels a year ago. While the year-on-year gains are positive, the overall trend for the year is on the decline and is likely to decrease further as the semiconductor shortage persists and further impacts new vehicle availability.
While inventory levels have been trending down at a topline level, there is additional volatility under the surface as days on market was down 5.7% from June and down over 27% year-on-year. This reduction in days on market highlights the increased demand for private car ownership and additional demand for vehicles not witnessed in the inventory.
The tightening vehicle market and decrease for days on market is impacting car prices as well. The average used vehicle listing price was up 4.1% from June and over 15% year-on-year. So far, the demand for used cars seems to be stronger than any concerns about increased prices.
Outlook
We should start to see some relief when it comes to the chip dip in the third quarter as production of semiconductors improves and OEMs are able to get silicon into waiting vehicles. However, even with the increase of semiconductors, we’re likely to see the impact linger throughout 2021 and potentially even longer.
To learn more about the trends impacting vehicle inventory, download the CarGurus Vehicle Availability Index & Insights July 2021.