by Wolf Richter
Wolf Street
Inventory gluts are resolved by lower prices that boost sales. But that part hasn’t started yet; the glut is still building.
It’s a good thing for new-car and new-truck buyers to go from inventory shortages, the odious addendum stickers we saw during the pandemic, spiking prices, and obscene profit margins by dealers and automakers to an inventory glut.
The inventory glut is starting to take on momentum. Incentive spending by automakers has been ramped up. Ultimately, inventory gluts are resolved by lower selling prices that stimulate higher unit sales as more customers find attractive deals. But that part hasn’t started yet; the glut is still building.