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In this enlightening episode, Kyle Mountsier sits down with Rebecca Lindland, Senior Director of Industry Data and Insights at Cars Commerce, to discuss the evolving landscape of automotive consumer behavior and dealership strategies. Rebecca highlights the critical issue of vehicle affordability, revealing the significant gap between consumer spending plans and available inventory, especially in the new car market priced under $30,000. She offers valuable insights on how dealers can navigate this challenge, suggesting alternatives like leasing and a strategic approach to inventory stocking. Rebecca emphasizes the importance of aligning dealership offerings with local market demands, utilizing tools like Accu-Trade for valuation and exploring used vehicles to bridge the affordability gap. The conversation provides a nuanced perspective on the automotive industry's response to changing consumer expectations and market dynamics.
0:06 - Intro
0:40 - The Importance of Context in Automotive Data Analysis
1:28 - Consumer Behavior Study: Vehicle Affordability Insights
2:21 - Addressing the Affordability Gap in Dealership Inventory
3:11 - Strategies for Dealers to Meet Consumer Demand
4:05 - Leasing as an Alternative for Consumers and Dealers
4:42 - Closing Thoughts and Appreciation for Rebecca Lindland's Expertise
Rebecca Lindland is the Senior Director of Industry Data and Insights at Cars Commerce
This interview was brought to you by Cars Commerce: https://www.carscommerce.inc/
Kyle Mountsier: 0:06
All right, I'm sitting here at the cars Commerce City or calling with Rebecca Lindland. The senior director of industry data and insights which look cars is a massive brand was so much data, so much sharper data, so much industry data that you're aggregating. And you get to sit at the helm of that I really understand not just where we've come from, because let me start with this. I believe that data is not just about the reports that we get, but it's the perspective that we get and on what the reports tell us about what's next. Absolutely. As you're looking at that, what are you seeing that's next for our industry?
Rebecca Lindland: 0:41
So we always are studying what's happened so that we can better understand what's coming. Yeah. Right. And we look at all different items of information, all different data points. And you know, you can always put out another report, but it doesn't matter if you don't have context. Right, right. So one of the things that we're studying right now is consumer behavior. We always look at consumers, they're our lifeblood. Sure. So right now we're looking at affordability. For most consumers vehicles are their second largest purchase, unless you're buying like a fabulous handbag or something. For the most. Part, this vehicles their second largest purchase. So affordability is top of mind. What we're seeing on the site is that about half of consumers say they're planning on spending $30,000 or less for their new vehicle.
Kyle Mountsier: 1:29
Wow. 50%, about
Rebecca Lindland: 1:32
50%. But only about 12% of the actual inventory of new cars are priced under $30,000.
Kyle Mountsier: 1:41
That is a massive gap and massive data reconcile Exactly.
Rebecca Lindland: 1:45
And so there are tools that you can go on cars.com to look at for calculating your price. And we always encourage people to buy within range, right? You don't want to overspend, there's nothing worse than being car poor, any more than house poor. Right. But what we're also seeing the challenge here is that for dealers, because there's high demand for vehicles priced under 30,000, and low inventory, those vehicles, those new cars priced under 30,000, sell 19 days faster than vehicles that are pricier. Well, that
Kyle Mountsier: 2:21
gets us under a 60 day turn for new cars on those vehicles. Absolutely.
Rebecca Lindland: 2:26
You it's a really big deal. Because one of the things that we're really focused on here at cars, commerce is getting not only the right product into the right hands, but getting the right inventory onto a dealer lot. We want to be able to align those two things by you know, when dealers are looking at vehicles, stock, what's going to sell in your neighborhood? Yeah, so
Kyle Mountsier: 2:47
what is because obviously, the OEM has a lot of a lot of like influence into what makes it to the lot. And so we have a fourth What 31% gap in demand versus inventory. As you're looking at the reports and saying what do we do about this? How are you encouraging dealers to meet that 31% gap? Is it leasing? Is it inventory changes? Is it used cars? Where is the best place to go? You
Rebecca Lindland: 3:11
know, it's a combination of things. It is It's about encouraging consumers to say, maybe you do consider a used vehicle, or maybe looking at the the length of your loan, right? Maybe leasing is right for you. And it's surprising with leasing, because a lot of people don't consider it only about 30%, or even less. But really look at how many miles you put on your vehicle every year. And say, you know, if it's in that 12 to 15,000 mile range, leasing may be perfect for you sure, three years time, then you either you turn in your vehicle, you get a new vehicle, or maybe you purchase it. But leasing is definitely something that consumers should consider. As more and more people are working from home as their you know, they're saying or they're having less of a commute. Yep, just consider leasing. It's a great way to get into the vehicle that you want at the budget you can afford. I love this
Kyle Mountsier: 4:05
insight, because we've all been talking about affordability when it comes to vehicle prices and interest rates. Yes, I understand the exact gap of what we're seeing in consumer demand versus available inventory, I think is really keen for dealers to say, Okay, how do I stock to the 31% gap that's out there in the mark.
Rebecca Lindland: 4:21
Absolutely. And then and then you can go again on the site. dealers can use things like Accu trade to look at their at the valuation of the used vehicle coming in, use your service lane to read into stuff on to find that inventory. And of course we encourage manufacturers to look at what people are buying and what they're interested in.
Kyle Mountsier: 4:42
That's amazing. Well, Rebecca, that is our why Oh, perfect insight for some of the conversations that we've had this weekend. Thank you so much. Thanks
Rebecca Lindland: 4:49
so much for having me on.