Jeep Wrangler inventories grow, even as sales climb

[Harley Lover]

All is not well in Jeep land, which hopefully has planners at Ford paying attention:

Judging by record sales since production began a year ago, Jeep fans are lapping up the redesigned Wrangler.

Which is good — because Jeep dealers are swimming in them.

Supplies of unsold Wranglers at U.S. dealerships or on their way there have ballooned to well more than 100 days in each of the past three months, including a 156-day supply at the beginning of November and 135 days at the start of this month

dealers say there might be another, more troubling factor affecting their ability to quickly sell the new JL Wranglers on their lot: price.

"I have the largest Wrangler supply I have ever had," said a dealer at a large store in the Midwest who asked not to be named. "That car has gone up in the last three years $12,000! These freakin' things are $55,000 now. I think that vehicle is price-sensitive, and I think they went a little far with the pricing. They were a little aggressive."

Information obtained by Automotive News shows that 11.7 percent of Wrangler registrations this year through October have been to fleet customers. That's close to triple what the off-roader's fleet mix was in 2016, when 96 percent of Wranglers were sold at retail.

To put more Wranglers in rental fleets "is the biggest bonehead decision you could ever make," one dealer told Automotive News. "The resale value has dropped, just in the last 60 days, by $2,500 a unit. Somebody is not thinking this whole thing through."

Entire article here:  https://www.autonews.com/sales/jeep-wrangler-inventories-grow-even-sales-climb

 

[silvrsvt]

Looks like they might have been over producing them in the Late spring/Summer-or that was just the change over with the old and new model

http://www.goodcarbadcar.net/2011/01/jeep-wrangler-sales-figures/

As for bitching about the price-the $55K is the most expensive model you can buy and you can get a decently equipment one for less then that...I get annoyed when people throw out the most expensive model pricing, which most likely makes up less then 10% of total sales.

Prices have risen (like all other cars out there) but I wonder how much impact keeping the Wrangler "basic" aka rougher and cheaper would have helped with sales...I know this much, FCA's profit margins would be lower.

Edited December 27, 2018 by silvrsvt

[Harley Lover]

1 hour ago, silvrsvt said:

As for bitching about the price-the $55K is the most expensive model you can buy and you can get a decently equipment one for less then that...I get annoyed when people throw out the most expensive model pricing, which most likely makes up less then 10% of total sales.

Prices have risen (like all other cars out there) but I wonder how much impact keeping the Wrangler "basic" aka rougher and cheaper would have helped with sales...I know this much, FCA's profit margins would be lower.

It's a dealer doing the complaining, so presumably he/she should know what he/she is talking about. OTOH, unless FCA are forcing a certain mix on the dealers for their ordered stock, I would think that the dealer has at least some control over what goes into dealer stock in terms of unit MSRP, so maybe the mention of the $55k price is to highlight an across the board increase in pricing for all levels. Coupled with the increase of fleet sales and the claimed loss in value mentioned in the quotes, the dealers seem to be getting it from both ends. All of which would seem to provide supporting evidence of why the DOS have gotten so high. 

I'm curious to see if FCA built inventory levels for the end of year sales and shutdowns at the plants, or if something more systemic is in play. Again, I hope the planners at Ford who get paid to analyze this stuff are paying attention.

[fuzzymoomoo]

35 minutes ago, Harley Lover said:

I'm curious to see if FCA built inventory levels for the end of year sales and shutdowns at the plants

That does happen. It's a little different at MAP this year being a new product launch but in years past we would work a little overtime between thanksgiving and Christmas to build up a little extra inventory for the 10 day holiday shutdown. They do generally still want to keep inventory a little snug for the end of quarter counts though.