Strong Sales Cut Feb. 29 Days’ Supply, Despite More Stock

Just as WardsAuto forecast a month ago, robust Jan. 31 light-vehicle inventory helped pump up February’s selling pace. That in turn trimmed Feb. 29’s days’ supply by nine days, or 11.5%, even as the month-end unit count rose 3.7%, setting the stage for a strong spring market to support the industry’s robust North American production plans.

At the February close, there were 3,836,091 new LVs in stock at U.S. dealers, up from 3,699,906 the prior month and the fourth-highest for any February in history, behind the record 4,054,973 units stockpiled
in 2005.

It also was 6.5% more than the 3,601,001 units counted on Feb. 28, 2015.

Despite the February buildup, the days’ supply barometer fell to just 69 at month’s end, the same as a year earlier, down from 78 days’ at the close of January as the February daily selling rate jumped 17% to 55,641 from 47,551 for the prior month and 52,171 in February a year ago.

Car inventory rose only 1.6% in February, with North America-built models up only 0.4% thanks to some judicious production actions. Days’ supply fell to 70 overall from 81 in January, with domestically built units dropping to 67 days from prior-months 79.

The number of light trucks in stock rose 5.2%, to 2.2 million-plus units, while days’ supply fell to 69 from January’s 76 days’ as sales strengthened.

Boding well for likely increases in second-quarter North American production schedules is the falloff on domestic-make light-truck days’ supply to 71 from 79 on Jan. 31, in spite of a 5.5% increase in the number of vehicles on dealer lots.

Among the brands surveyed, Volkswagen appeared to be facing the largest LV inventory glut, with its Feb. 29 days’ supply down only slightly to 97 from 100 days’ a month earlier. VW’s tally was also well above 86 days a year ago, although its February unit-stock of 90,554 was 1.2% lower than at this time in 2015.