Momentous rise in new vehicle inventory sparks renaissance of competition
Average Prices for Commercial Vehicles
New Commercial Vehicle Inventory
Chico, CA, April 16, 2024 (GLOBE NEWSWIRE) — Work Truck Solutions®, the leading authority on commercial vehicles, today released their Q1, 2024 Commercial Vehicle Market Analysis, highlighting numerous key industry trends.
Inventory
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On-lot new vehicle inventory per dealer continues an upward trend, registering an increase of 12.7% QoQ and a very significant 93.1% YoY jump. Medium-duty vehicles are key contributors to this growth, constituting 52.4% of the on-lot inventory.
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New cutaways are significantly down in volume, by 24.0% QoQ and 21.7% YoY. Cutaways are generally the 4th highest in volume because they serve a variety of vocations, such as plumbing, construction, and HVAC, so these changes are impactful.
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New commercial EVs, although still comparatively small in overall inventory numbers, also saw a significant increase in on-lot numbers, up 51.5% QoQ and 67% YoY.
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Used inventory showed the opposite trend from new vehicles, with an 8.4% decline QoQ and 18.6% YoY.
Prices
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The latest data reveals average prices for new commercial vehicles are holding relatively steady, with a modest QoQ increase of 0.1% and a slight increase YoY, up 4.2%. However, the Q1 2024 average price of $58,913 is recorded as the highest average price to date.
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New light-duty Battery Electric Vehicle pickup prices declined with a 2.5% drop QoQ and 18.1% YoY.
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In contrast to the growth in the new work truck space, the used inventory sector presented a different scenario. Average prices of used work trucks and vans reported a decrease of 4.2% QoQ and 2.9% YoY. Price drops reflect the rising median mileage of used work trucks and vans, which has increased 6.9% QoQ and 7.8% YoY.
Days to Turn
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Steady increases in inventory, record high prices, fewer leads, and high interest rates have precipitated a marked rise in Average Days to Turn (DTT) for new vehicle inventory, with an increase of 12.5% QoQ and a 21.8% YoY spike. Sitting at an average of 105 days in Q1 2024, new vehicle DTT is the highest it’s been since Q4 2020.
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The average DTT for used vehicles, however, showed a slight QoQ decrease of 4.7% QoQ, and a YoY decrease of 18.4%.
Sales
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As indicated by the increased DTT, new vehicle movement, or sales, per dealer, showed a declining QoQ trend of 12.6%. This is partly due to the increased inventory relieving some of the pent up demand, but also due to the market dynamics of increased interest rates, and pressures and considerations towards new options for lowering emissions. However, the data still registered an 11.2% increase YoY.
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As a whole, new commercial EV sales remained virtually flat QoQ.
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Sales of used vehicles fell at an accelerated rate, with the average number of work trucks/vans moved per dealer decreasing 10.2% QoQ and 23.2% YoY.
Vocation
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The distribution of body types QoQ is stable, with service bodies still in the top spot.
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YoY there is a decline in the totality of vans, from empty cargo vans to minivans that were filling in for the decimated van inventory during the Pandemic, due to the sudden increase in delivery demand.
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With the reduced inventory of cutaways, we will keep an eye on the demand from top users in those vocations:
1. Cargo/Freight Transport
2. Plumbing
3. Construction
4. Contractor
5. HVAC
Together, these top 5 vocations comprise roughly 61% of demand for cutaways on all our platforms (dealership sites, OEM Tier-1 sites, Upfitter Locators and Comvoy.com) combined.
Takeaways
“As we unveil our Q1 2024 data findings, it’s clear there is improved availability of new work trucks, vans and SUVs, which is welcome news to buyers after the last few years of restricted commercial vehicle inventory,” said Aaron Johnson, CEO of Work Truck Solutions. Johnson noted that the swell in new vehicle inventory, coupled with increased Days to Turn (DTT), is sparking renewed competition among commercial vehicle dealers. As a result, it is critical for dealerships to differentiate themselves by embracing digital merchandising tools that enhance the buyer experience. Furthermore, Johnson commented that “these tools should also streamline operations by providing data analytics that aid intelligent stocking, marketing and inventory management strategies, and decision-making. A digital-first approach is increasingly crucial for commercial vehicle dealers.”
Johnson concluded his assessment by saying, “Events such as the Pandemic, high-interest rates, and now the tragic destruction of the Francis Scott Key bridge remind us how important it is to stay vigilant in our customer focus, and also underscore the vital role that timely data, coupled with the right solutions, play in powering the success of commercial vehicle operations across the nation. At Work Truck Solutions, we’ll continue to provide our customers with innovative solutions to help them thrive during these dynamic market conditions.”
About Work Truck Solutions
Work Truck Solutions is the smart technology platform that serves the Commercial Vehicle Industry. End-to-end solutions such as Comvoy.com, the national commercial marketplace, NuPropel, the commercial vehicle-centric advanced fuel resource center, and CV Showroom™, the smart digital catalog of commercial vehicles not in stock, connect the dots between commercial vehicle buyers, dealers, manufacturers and upfitters. This innovative technology is the one-stop inventory management, operational analytics, and digital marketing solution that maximizes commercial sales, customer relationships and profitability.
Attachments
CONTACT: Steve Henning Work Truck Solutions 530-718-1885 [email protected]
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