You would have to be living under a rock to not know that most things are much more expensive today than they were five years ago. The rate of inflation is 21.5% since 2018!
>21% inflation is bad enough, but in some cases automobile manufacturers have increased their MSRPs far outpacing even exorbitant inflation rates. Who are the worst offenders?
CarEdge has published a report showing Hyundai Motor Group (Hyundai, Genesis, Kia) have increased MSRPs 45.86% since 2018, making it the second worst MSRP offender, only surpassed by Stellantis (Jeep, Dodge, Chrysler, Ram, Alfa Romeo, Fiat) who raised their MSRPs by 48.61%!
While both are bad news for consumers it seems HMG is getting away with increases Stellantis is not. HMG currently only has a 45 day market supply (meaning if they continue to sell at the current rates they will run out of cars in 45 days unless inventory levels are replenished), whereas Stellantis has a 160 day inventory supply. Most Stellantis vehicles will sit on the lot over five months before being sold off!
As consumer and business interest rates continue to rise Stellantis dealers are having a tougher time maintaining floorplan financing due to cars sitting on lots longer and longer periods of time. This also means lenders may force car dealerships to carry higher cash reserves, which then means the dealership’s access to otherwise available credit is hampered. A credit death spiral occurs.
The CarEdge data also confirms a correlation between MSRP increase rates and excess inventory. No surprises here: in general, the brands that have increased MSRP the most are not selling the cars they have quickly. Those that have increased MSRP the least are moving their product.
Contrary to the trends and despite raising their MSRPs second-to-most Hyundai Motor Group has been able to increase its market share 7.34% during the last five years. One can interpret this as US consumers still view Hyundai, Genesis and Kia as a good value, despite the increasingly higher prices.