U.S. July Light-Vehicle Inventory Up 11% From Year-Ago

U.S. light-vehicle inventory stands at solid levels heading into the final five months of the year, helped by several North American plants cancelling or shortening their summer shutdowns in July.

However, supply still is low enough that production will have to remain in high gear.

LV inventory ended July with 2.95 million units, 11.1% more than year-ago and equivalent to a 56 days’ supply, nearly even with 55 in like-2012.

July inventory also was down 8.3% from June, with days’ supply dropping from 60. The decline from June is typical, because July’s production generally is the lowest of any month due to vacation and model-changeover shutdowns.

Inventory of domestic-built vehicles totaled 2.31 million units on July 31, up 8.8% from year-ago. Domestic stocks held at 58 days’, compared with 61 in June and 57 year-ago.

Import LV inventory totaled 634,686 units at the end of last month, a 20.3% gain on prior-year and just slightly less than in June. Days’ supply was 52, compared with 56 in June and 49 in like-2012.

The LV inventory is estimated by WardsAuto to be optimal for August sales to run close to the 15.4 million seasonally adjusted annual rate of the first seven months, but below the 15.8 million-unit averaged over the last two months.

If sales continue at the June/July pace in August, inventory could remain flat or even decline. That could dampen September’s sales somewhat as popular vehicles temporarily will be in short supply.

This bodes well for North American auto makers that supply nearly 80% of the inventory to U.S. dealers and will have to run production close to 100% straight-time capacity for the remainder of the year.

WardAuto/AutomotiveCompass forecasts North American LV production for August at 1.46 million units, up 2.9% from year-ago. Output for the next five months is expected to rise 5.1% from prior-year, boosting total 2013 builds to 16.1 million, up 4.2% from 2012.

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