Order Update February 2024 Driven

Below we outline some of the major factors influencing vehicle supply and availability:

• Industry experts predict the UAW strike to potentially increase vehicles prices by $700 to $900 per vehicle.  ​
• Non-UAW OEMs have all increased the wages to their employees to prevent the UAW from gaining a foothold at those plants. ​
• There are geo-political flare ups with terrorist activity impacting Suez Canal resulting in ships being diverted around Africa causing delays and higher costs due to fuel. ​
• We expect that few vehicles/models will have production constraints for MY 2025.  Work vans, hybrids and medium duty vehicles will continue be in tight supply.
• Light duty pickups, SUVs, Sedans and EVs will be available from most OEMs without supply chain constraints.
• All OEMs are open to accepting new customers.
• Dealership inventory (new vehicles) has increased to 71 days.  
• We expect to see some OEM’s increase incentives in MY2025.
• In Canada, EVs will be marketed heavily due aggressive govt. mandates.

Early View of MY 2025

Other than some popular fleet vehicles (Vans, Pickups and Hybrid), we expect most OEMs to have fewer allocation constraints meaning fleet customers will be able to order what they need.

Additionally, availability is dependent upon the vehicle type needed. Heavy demand for pickups, work vans and hybrid vehicles, which are in limited supply due to battery constraints, will almost certainly cause OEMs to cut off orders early in some cases and extend order banks in other cases. This will most likely continue through MY2025. 

Be Aware

Vehicles with upfit could experience delays as upfit lead times have increased and production dates and lead times will continue to evolve throughout the year. 

For out-of-stock orders, expect high prices, low inventory and longer timeframes. To increase your out of stock options, decide on “must have” vs. “can’t have” equipment and colors—don’t expect to purchase vehicles that are a perfect match. Once a vehicle is located for you, approve it quickly. A delay could case you to lose the vehicle.

Unfortunately, vehicle delivery delays continue. This is due to industry logistics that are severely constrained, making it difficult for any OEM or supplier to provide concrete delivery dates.

Here are some of our observations we would like to share with you based on our experience, research, and expertise:

• Production is expected to increase throughout the industry. Allocation will apply to only certain popular fleet models.
• Retail sales are softening which could lead to more fleet allocation.
• We expect a year-over-year price increase between 3-10%.
• OEMs are starting to increase supply to their rental partners.
• Nationwide labor shortages especially in logistical areas continue to impact delivery of vehicles to drivers. Examples of congestion areas continue to be Kansas City and Mexico.
• Ford and GM are not expecting to build as many EVs as originally forecast.  EV pricing continues to fluctuate.  Many OEMs dropped prices on EVs and provided customer incentives, but we have noticed one OEM who has increased prices to due to demand for certain vehicles.