Welcome back to the CarDealershipGuy newsletter. Where you can get all the top automotive news in 5 minutes or less.
- 🛠 Repair Orders Are Way Down
- 🧾 August 2022 New-Vehicle Sales
- 🤝 German Car Companies Strike A Deal With Canada
- 📌 CarDealershipGuy Job Board
- 📖 Articles I Read This Week
Read Time: 3 Minutes & 58 Seconds
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Repair Orders Are Way Down
The July numbers for the dealership repair order volume are in and they are not good.
Why is this? Are cars built better? Are people buying less? Are fewer people driving?
Whatever it is, it’s bad for car dealers all over the country as most of their revenue comes from servicing vehicles.
If you take a look above you can see the Xtime Repair Order Volume Index. Think of this as the compilation of data from dealerships around the country that tells us how active each service center is.
You can see that in July auto repair order volume was down to 86.5.
This is 6% lower than what the numbers were in June and it is down 9.8% from last year's July numbers.
Why is this happening?
It's likely for a variety of reasons:
- Supply chain restraints leaving dealerships with no parts
- Limited workforce
- People postponing maintenance
- Some people are driving less than they used to
- Lack of rental car availability
Whatever it is let's hope these numbers pick up fast. At least for the dealer's sake.
August 2022 New-Vehicle Sales
This is the Cox Automotive August 2022 New-Vehicle Sales Forecast. Let's jump in!
If you remember from a few weeks ago we covered the July Sales Forecast chart.
In July we had 1,143,524 cars sold in that month. But in August we are only forecasted to have 1,140,000 sold.
That will be a decline of -0.3% MoM.
On the bright side, it looks like August 2022 might see a 3.6% increase from August 2021 sales. However, there will be 26 trading days this August. Which is one more than last year. Giving this year a little of an unfair advantage if you ask me.
So why are sales forecasted to decrease?
Well, it could be because of:
- Rising interest rates
- Low consumer sentiment
- High gas prices
- Inflated prices
- Small selection
Sales are expected to pick up in the coming months. But, in order to see some serious growth we will need to see some fixes to some of the macro issues going on like supply chain and interest rates and sadly those are not in the control of your local dealership.
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German Car Companies Strike A Deal With Canada
Every auto company is already producing or has plans to begin producing, EVs.
But with everyone making these promises it has become increasingly more difficult to find the materials needed to build the batteries that these EVs require.
This is why Mercedes-Benz and Volkswagen, two of the largest German automotive companies, have struck a deal with the government of Canada. This deal grants them access to acquire Canada's rare earth materials that are needed for making batteries for EVs.
These materials needed for battery production include but are not limited to:
Mercedes-Benz and Volkswagen hope to secure these materials to generate their fleet of EVs for North America.
Let’s hope they pull it off and get the materials they need. Because one thing is for sure. Anyone can say they want to make EVs. But the materials needed to make them are limited. So only time will tell who is able to pull it off.
CarDealershipGuy Job Board
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Articles I Read This Week
- Steve Jobs was all about secrecy. He might be crawling out of his grave on this one.
- Hope you got your FSD (Full Self Driving) Tesla already because it looks like prices are going up.
- Ford is the next auto company to start raising prices on their EVs because of “supply chain”.
- California being at the forefront of climate change saying no more gas cars by 2035.
- I think this Tesla fan has watched Iron Man to many times.
Thank you for joining me again here on the CarDealershipGuy newsletter. See you next week!
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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.