Asbury Automotive Group Inc. reported new-vehicle supply of 26 days at the end of 2022, up from 19 days at the end of September and just eight days at the end of 2021. CEO David Hult said this month that Asbury’s highest-volume luxury- and import-brand dealerships still had days’ supply in only the single-digit range at year-end.
“That really governed our ability to grow what was there,” Hult said, adding that more than 35 percent of Asbury’s inventory remains presold in early 2023.
Some automakers are rebuilding their supplies sooner, Hult said, while others will need most of 2023 to return to normal. Stellantis and other domestic-brand automakers are likely to be restored in the first half of this year, he said, but brands such as Toyota and Honda will take longer.
Asbury should maintain good margins even with vehicle inventory increasing, Hult said, citing an example of an unnamed domestic-brand automaker. That automaker “got back to close to normal levels” of supply, yet recent gross margins were much higher than in 2019, before the pandemic, he said.
“So we think [gross profit in 2023 will] be healthy,” Hult said. “We think it’ll be well above ’19.”
Gail Howe, John Huetter and C.J. Moore contributed to this report.
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