Do you think there will eventually be a glut of cars, and if so, when?

[Anonymous]

1 year? 2 years?

Just trying to decide when and how much work to do to my aging car. No desire at all to buy at these prices and under these conditions (sight unseen.)

[Anonymous]

No. Manufacturers will attempt to balance supply and demand, not try to produce more supply than there is demand, which is what your questions says you're hoping for. Manufacturers don't always get it right, under and over-estimating demand for some vehicles, and that's where your opportunity is today and tomorrow. Negotiate for less popular (i.e., less in-demand) vehicles, not the current fads-du jour which everyone is clamoring for.

[Anonymous]

Anonymous wrote:No. Manufacturers will attempt to balance supply and demand, not try to produce more supply than there is demand, which is what your questions says you're hoping for. Manufacturers don't always get it right, under and over-estimating demand for some vehicles, and that's where your opportunity is today and tomorrow. Negotiate for less popular (i.e., less in-demand) vehicles, not the current fads-du jour which everyone is clamoring for.

I mean, there were a glut of cars for decades. How can you be so sure it’s “never again”? I’ve never paid MSRP or anything close, and I’ve bought many many new cars.

[Anonymous]

Negotiate for less popular (i.e., less in-demand) vehicles

PP, any recommendations? Sounds like you know cars. np here. New under 30K, ideally under 26K. A sedan. Can be low-frills

[Anonymous]

Anonymous wrote:

Negotiate for less popular (i.e., less in-demand) vehicles

PP, any recommendations? Sounds like you know cars. np here. New under 30K, ideally under 26K. A sedan. Can be low-frills

let me know when you find out. i got two emails this morning - one from honda dealer and the other from toyota dealer. honda is asking 5k mark up, toyota was asking 4k mark up. it's gonna be awhile before we go back to old days

[Anonymous]

Anonymous wrote:

Anonymous wrote:No. Manufacturers will attempt to balance supply and demand, not try to produce more supply than there is demand, which is what your questions says you're hoping for. Manufacturers don't always get it right, under and over-estimating demand for some vehicles, and that's where your opportunity is today and tomorrow. Negotiate for less popular (i.e., less in-demand) vehicles, not the current fads-du jour which everyone is clamoring for.

I mean, there were a glut of cars for decades. How can you be so sure it’s “never again”? I’ve never paid MSRP or anything close, and I’ve bought many many new cars.

Never again because things are more profitable to dealers and manufacturers. Carmakers have to move cars in a market of oversupply by offering incentives, rebates, holdback, price supports etc. to dealers and customers. This cuts into profits which are at historic highs for dealers.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:No. Manufacturers will attempt to balance supply and demand, not try to produce more supply than there is demand, which is what your questions says you're hoping for. Manufacturers don't always get it right, under and over-estimating demand for some vehicles, and that's where your opportunity is today and tomorrow. Negotiate for less popular (i.e., less in-demand) vehicles, not the current fads-du jour which everyone is clamoring for.

I mean, there were a glut of cars for decades. How can you be so sure it’s “never again”? I’ve never paid MSRP or anything close, and I’ve bought many many new cars.

Never again because things are more profitable to dealers and manufacturers. Carmakers have to move cars in a market of oversupply by offering incentives, rebates, holdback, price supports etc. to dealers and customers. This cuts into profits which are at historic highs for dealers.

More profitable for dealers and manufacturers. Hmmm?

At the moment car dealers are moving less vehicles and dealerships have plenty of empty spaces. I'm surprised that you think the current market is more profitable for them.

[Anonymous]

NP. What about the used car market? We prefer to buy a car that is a few years old, not new. We have a 13 year old vehicle that we'd like to replace rather than pour money into, but have been holding off the last year due to how tight the used market is.

It seems like once supply chain gets addressed, a lot of people who have been waiting on new cars will get them, and we'll see more 2018/2019 vehicles on the market, right?

I have been getting impatient and started talking to dealers about a few cars. The pricing is actually fine (we're looking at 3-4 yr old wagons and hatchbacks with less than 40k miles and above base model, and finding things in the 19k-24k range, which is our sweet spot). The issue is that inventory is so limited. We have a handful of models we're interested in and if we decide to buy now, we will really have to hunt for what we want. I'm hoping for an influx of slightly aged cars in the next 6 months or so just to make the process easier.

[Anonymous]

Anonymous wrote:NP. What about the used car market? We prefer to buy a car that is a few years old, not new. We have a 13 year old vehicle that we'd like to replace rather than pour money into, but have been holding off the last year due to how tight the used market is.

It seems like once supply chain gets addressed, a lot of people who have been waiting on new cars will get them, and we'll see more 2018/2019 vehicles on the market, right?

I have been getting impatient and started talking to dealers about a few cars. The pricing is actually fine (we're looking at 3-4 yr old wagons and hatchbacks with less than 40k miles and above base model, and finding things in the 19k-24k range, which is our sweet spot). The issue is that inventory is so limited. We have a handful of models we're interested in and if we decide to buy now, we will really have to hunt for what we want. I'm hoping for an influx of slightly aged cars in the next 6 months or so just to make the process easier.

That inventory is limited because you're basically looking for a car that was purchased right before the pandemic. We bought one of those vehicles and we are probably going to sit on it for 7-8 years given the craziness in the car market. We'd love to upgrade to an EV but it's just not in the cards for us given the current market.

I think we start seeing a glut of ICE vehicles once the battery manufacturing and chip issues are sorted out. EV prices will come down a bit from their current average price of $52K. The low-end EVs just are not available right now as the manufacturers focus on putting chips and batteries in higher margin EVs.

So, probably 2-3 more years.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:No. Manufacturers will attempt to balance supply and demand, not try to produce more supply than there is demand, which is what your questions says you're hoping for. Manufacturers don't always get it right, under and over-estimating demand for some vehicles, and that's where your opportunity is today and tomorrow. Negotiate for less popular (i.e., less in-demand) vehicles, not the current fads-du jour which everyone is clamoring for.

I mean, there were a glut of cars for decades. How can you be so sure it’s “never again”? I’ve never paid MSRP or anything close, and I’ve bought many many new cars.

Never again because things are more profitable to dealers and manufacturers. Carmakers have to move cars in a market of oversupply by offering incentives, rebates, holdback, price supports etc. to dealers and customers. This cuts into profits which are at historic highs for dealers.

More profitable for dealers and manufacturers. Hmmm?

At the moment car dealers are moving less vehicles and dealerships have plenty of empty spaces. I'm surprised that you think the current market is more profitable for them.

It’s not what I think. It’s an empirical fact for most dealerships. Most are marking up vehicles to the tune of $3000 to $5000 above MSRP. In 2019, the average profit on a new car was about $1900 after taking into account dealer add-ons and F&I products (extended warranty, TruCoat, “paint sealer”). It’s now more than $5000.

https://www.autonews.com/dealers/nada-forecasts-record-2022-profits-car-dealers

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:No. Manufacturers will attempt to balance supply and demand, not try to produce more supply than there is demand, which is what your questions says you're hoping for. Manufacturers don't always get it right, under and over-estimating demand for some vehicles, and that's where your opportunity is today and tomorrow. Negotiate for less popular (i.e., less in-demand) vehicles, not the current fads-du jour which everyone is clamoring for.

I mean, there were a glut of cars for decades. How can you be so sure it’s “never again”? I’ve never paid MSRP or anything close, and I’ve bought many many new cars.

Never again because things are more profitable to dealers and manufacturers. Carmakers have to move cars in a market of oversupply by offering incentives, rebates, holdback, price supports etc. to dealers and customers. This cuts into profits which are at historic highs for dealers.

More profitable for dealers and manufacturers. Hmmm?

At the moment car dealers are moving less vehicles and dealerships have plenty of empty spaces. I'm surprised that you think the current market is more profitable for them.

It’s not what I think. It’s an empirical fact for most dealerships. Most are marking up vehicles to the tune of $3000 to $5000 above MSRP. In 2019, the average profit on a new car was about $1900 after taking into account dealer add-ons and F&I products (extended warranty, TruCoat, “paint sealer”). It’s now more than $5000.

https://www.autonews.com/dealers/nada-forecasts-record-2022-profits-car-dealers

That doesn’t mean the market will sustain them doing this. It only takes one or two dealers to stop doing it and those will get all the business. Then the others will follow. Once supply rebounds, watch it happen.

[Anonymous]

Once there is enough capacity, big manufacturers will always be chasing for the next sales crown. Dealers on the other hand are making more money than ever currently so they won’t want a glut of cars in stock. I’m guessing eventually manufacturers will win out and start incentivizing dealers to take in unwanted inventory like before.

[Anonymous]

Anonymous wrote:Once there is enough capacity, big manufacturers will always be chasing for the next sales crown. Dealers on the other hand are making more money than ever currently so they won’t want a glut of cars in stock. I’m guessing eventually manufacturers will win out and start incentivizing dealers to take in unwanted inventory like before.

I’m not convinced the markups have made up for the loss of volume.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Once there is enough capacity, big manufacturers will always be chasing for the next sales crown. Dealers on the other hand are making more money than ever currently so they won’t want a glut of cars in stock. I’m guessing eventually manufacturers will win out and start incentivizing dealers to take in unwanted inventory like before.

I’m not convinced the markups have made up for the loss of volume.

You can stick your head in the sand and believe whatever you want or do some research and look at the facts. The biggest dealer groups in the US are publicly traded companies and release their financial info to the public. They have made record profit since COVID started.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Once there is enough capacity, big manufacturers will always be chasing for the next sales crown. Dealers on the other hand are making more money than ever currently so they won’t want a glut of cars in stock. I’m guessing eventually manufacturers will win out and start incentivizing dealers to take in unwanted inventory like before.

I’m not convinced the markups have made up for the loss of volume.

Check your Magic 8 Ball