After Abysmal January Sales, Car Dealers Are Overflowing With Unsold Cars

We recently discussed the dismal sales start for the US automobile industry in 2019. Now, a follow up by the WSJ paints an even more pessimistic picture for the start of February.

According to the report, dealers are starting 2019 with a growing surplus of inventory of unsold vehicles, which will likely pressure them to cut output: there were 3.95 million vehicles in lots at the end of January, a 4% increase from December and up nearly 3% from last January.

And even though seasonality exists in the industry and the winter is traditionally slower for automotive sales, the inventory build up could be problematic because dealers are starting the year with more unsold inventory than they had when auto sales peaked three years ago. Back then, 17.55 million cars were sold and now, while the latest estimates expect less than 17 million vehicles to be sold in 2019.

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