End In Sight For Auto Shortage? Not So Fast

By now, everyone knows there is a global auto supply shortage. The impacts of pandemic supply constraints and a global microchip shortage have combined to shrink inventory.  June sales saw a significant impact on new-car sales, with June down 14 percent versus 2019.

On the flip side, auto industry companies are seeing soaring profit levels on new cars.  Low supply and high demand have led to limited discounting of new vehicles.  Ford posted a Q2 profit and raised its outlook for the rest of the year. Forbes reported a Q2 increase of 41% for at least one automotive group for "front-end yield" versus last year.  Inventory has conversely fallen to record lows, with just a few weeks inventory for many dealerships, and 25 days nationwide in early July.  Toyota benefited from the tumultuous market, relying on a stronger chip supply than other automakers and taking the top spot in Q2 US sales for the first time.