August U.S. LV Inventory Sees Gain on Year-Ago

Strong North American production and an apparent heavy influx of imports kept August U.S. light-vehicle inventory from dipping too far below July levels after sales surged to a 16.0 million seasonally adjusted rate last month.

LV inventory ended August at 2.917 million units, down 1.0% from July and well within the normal seasonal trend. However, supply was up 6.3% from year-ago, closer to like-2012 levels than the shortages tracked this year through July.

The difference in August sales volumes was the inclusion of the Labor Day weekend that fell in early September, pulling units ahead and artificially creating a lower inventory total. Having the holiday included in August also means September will have a lower number of selling days than usual, so not as much inventory will be required.

LV 55 days’ supply as of Aug. 31 was nearly even with July’s 56 and somewhat less than year-ago’s 58, but still a healthy level for the season. With low-volume sales months ahead, days’ supply will rise, peaking at 60 to 70 in October and November before dropping in December, when demand typically spikes upward.

The effect of pull-ahead sales volume from September caused inventory of domestically made vehicles to decline from July after increasing in each of the past three years.

LV domestic inventory totaled 2.301 million units in August, compared with 2.314 million in July, but was up 5.2% from year-ago’s 2.187 million. Days’ supply was 56 compared with prior-month’s 57 and like-2012’s 59.

Import inventory, which in most years posts month-to-month declines between 5% and 10%, fell only 2.8% from July. Dealers ended August with import stocks of 616,733 units, compared with July’s 635,379, a hefty 10.6% above year-ago.

Days’ supply for imports was 50 vs. July’s 52 and same-month 2012’s 56.

New-car inventories saw a slight dip in August from July, while light trucks dropped 1.6%. Thanks to a reduction in domestic production, light-truck supply was below year-ago for the first time since May 2010. Truck inventory of 1.536 million units was down 1.0% from prior-year’s 1.560 million.

Car inventory ended August up 15.7% from year-ago with 1.382 million units. Days’ supply was 53, nearly even with July’s 54 and surpassing 2012’s 51.

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