Car dealerships sold a ton of new vehicles last month, but they could have moved even more—if only they had more cars on hand to sell.
The final numbers for August auto sales recently came in and, as expected, it was a monster month for car dealers and automakers. More than 1.4 million new vehicles were purchased, an increase of 14%. The tally put the U.S. auto market on pace for more than 16 million cars to be sold in 2013, a figure not reached since 2007.
Sales have been so good that car sellers have been in the unusual position of sometimes not having the cars that buyers want available. The Wall Street Journal recently reported on car dealerships around the country that have barely had enough Ford Fusions, Jeep Wranglers, Nissan Sentras, Chevy Impalas, and Honda Accords, Civics, and Odysseys to keep up with demand. A Nissan dealership in California, for instance, normally has 15 to 20 Sentras handy, but it started August with just a single model available on the lot.
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Playing off the hot month of auto sales, Businessweek rounded up a list of seven vehicle models that sold at a rate of less than 90 seconds in the U.S. in August. For example, one Toyota Camry was purchased every 60 seconds, on average. Honda Accords and Civics have been selling every 68 and 69 seconds respectively, while the perennial American best-seller, the Ford F-series truck, required just 38 seconds per sale in August.
While the numbers indicate consumers are clearly in a mood to buy, it hasn’t been a particularly good time to bargain. According to the car-research site TrueCar.com, the average light vehicle purchase price in August was $31,252, an all-time high, and increase of $978 (3.2%) over August 2012. (The average price paid for new cars in 2012 was $30,500, which was a record high at the time.) Drivers have been paying a lot more lately for certain in-demand vehicles. The average Ford Fusion, for instance, has been selling for $26,137, which is 13% more than a year ago, according to TrueCar.
Rising sales, combined with a relative dearth of cars to sell, has meant that dealerships don’t have to bend over backward trying to get drivers to buy. “For consumers, limited supplies of popular models mean bargain prices are harder to come by, even during the annual summer clearance sales,” the Wall Street Journal noted.
In some cases, automakers are trying to pick up the production pace of hot-selling vehicles. But it’s a tricky business, with automakers in the position of wanting enough cars to satisfy consumer demand, but not so many that vehicles sit around on dealership lots for weeks. The one thing they certainly don’t want is a glut of cars that they’re forced to sell at major discounts.
After an absolutely huge August, a much slower month of sales is expected for September. In addition to August closing out the summer, it benefitted from having five weekends to build up sales. Understandable, “We expect September to retreat a little,” Volkswagen Group of America CEO Jonathan Browning told USA Today, in a story exploring the idea that auto sales may have just peaked—and a significantly slower period for sales should be expected. A post-summer slump in demand is also pretty standard.
All of which may be good for consumers: If and when dealers start having trouble finding buyers and the cars begin piling on lots, that’s when folks who are in the market for new cars sit in the driver’s seat of negotiations.