Cloud Theory’s “On The Horizon” Reports that Luxury Automotive Manufacturers Have Soared on Inventory Efficiency, Led by Land Rover
Cloud Theory, the real-time automotive data insights provider for automotive manufacturers, agencies, and affiliates, is reporting in this month’s “On the Horizon,” that new vehicle inventory has continued to charge forward, rising 6% in December after an 8% increase the prior month. Over the past year, supply jumped by exactly 1 million—from 1.64M to 2.64M.
OEMs continue to push more vehicles into the marketplace as supply chain challenges ease and as model year changeovers played out in December. 18 of the top 20 makes saw month-over-month inventory increases, with Toyota and Buick (both down 1%) being the only exceptions.
End-of-year deals related to model year changeovers helped push vehicle movement up by 14% month-over-month to 1.12 million. January projections indicate that this growth will recede to 1.08 million as season shifts diminish. While this is higher than most months throughout 2023, the trajectory of demand is not keeping pace with the recent rapid growth in supply.
“It’s good to see the industry selling more vehicles in December, but the overall trend towards a more supply-dominated environment is still in place,” said Rick Wainschel, Vice President of Data Science & Analytics at Cloud Theory. “OEMs are going to continue growing inventory even as demand doesn’t keep pace, which will inevitably lead to a more competitive marketplace in terms of demand creation and pricing.”
Cloud Theory’s proprietary Inventory Efficiency Index sees Toyota—which was one of two top 20 makes that did not see an inventory increase in December—move back into the top spot, while November leader Honda drops back into third place.
The noteworthy story in December is the rise of luxury makes in terms of IEI score and order, led by Land Rover, which jumps four spots to rank #2. Lexus, Cadillac, and BMW also experience sharp increases in IEI score. Land Rover leads in four of the nine US Census Regions and is in the top five in the others, while Lexus and BMW lead in two others.
“December is a key month for luxury OEMs, and it certainly appears that their advertising and other support programs were successful,” said Ron Boe, Chief Revenue Officer at Cloud Theory. Month-over-month vehicle movement increases of 91% for Land Rover and 53% for BMW are examples of that success. “Now that the calendar has turned the page on the key selling season, it will be important for those manufacturers to continue fighting for demand in an increasingly competitive marketplace,” Boe continued.
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