The coronavirus pandemic hammered the auto industry as plants and dealerships were closed due to stay-at-home orders.
Both have since reopened and auto sales have quickly rebounded following steep declines earlier this year. Unsurprisingly, trucks have led the way but demand is on the verge of outstripping supply.
While it’s no secret that truck inventories have been running low, CNBC reports GM is facing “historically low levels” of supply. In particular, the company only has about 20 days worth of GMC Sierra pickups which is far less than the typical 75-90 day supply. The situation is largely the same at Chevrolet as they have approximately 26 days worth of inventory.
Of course, GM got hit by a double whammy of last year’s UAW strike and then the coronavirus pandemic. Both caused plants to close and inventories levels to drop.
However, GMC’s Duncan Aldred suggested strong sales are primarily responsible as he said “We’re continuing to sell faster than we build. That’s not a comment on the build schedule, that’s a comment on how fast we’re selling them.”
GM’s second quarter results showed year-to-date sales of the Silverado 1500 increased 4.1% compared to 2019, while the GMC Sierra 1500 was up to 6.0%. Sales of the heavy duty variants also climbed on a year-to-date basis.
At the time, GM noted “solid demand translated to stronger average transaction pricing and lower incentives, with full-size pickup ATPs increasing $1,526 (£1,176 / €1,287) versus the first quarter.”
Of course, there are some downsides as customers can have a hard time finding the exact truck they want. Strong demand and low inventories also discourage discounts, so you might have to pay more to get behind the wheel of a pickup.