Survey: Inventory Shortages Having Widespread Impact on Car Shoppers' Behavior
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Survey: Inventory Shortages Having Widespread Impact on Car Shoppers' Behavior

By Analytics Team | August 31, 2021

Highlights:

  • 51 percent of current car shoppers are finding ‘less’ or ‘significantly less’ inventory than they expected.

  • Safety features are the key item people are not willing to compromise on when they’re faced with thin choices at the dealership; switching to a different vehicle brand is the most common decision change.

  • Truck shoppers are the most loyal to their brands across all vehicle segments; they’re the least likely group to buy from a different automaker, when faced with limited inventory. Small/compact sedan shoppers were the most likely to switch brands.

  • 44 percent of shoppers are changing the timing of their next vehicle purchase due to inventory issues.


Full Story:

Inventory shortages have been slamming the new and used car markets for months, thanks to a perfect storm of chip shortages for new vehicles, low interest rates, pent-up demand, and a volatile rental car market.

But how is that affecting consumers’ attitudes and reactions to the car-shopping experience amidst all this turmoil? To find out, Autolist.com surveyed more than 1,500 current car shoppers in August 2021.

The results showed widespread frustration with low inventory levels and higher-than-expected prices. They also showed how consumers are responding, whether that’s changing the timing of their purchase, opting for a different vehicle type or brand than they initially were considering, or spending more than they originally budgeted for.

“The past 18 months have been a rollercoaster ride for consumers trying to navigate the new and used-car markets,” said Corey Lydstone, president and CEO of Autolist.com. “This survey really digs into just how these historically low inventory levels are affecting what, where, and when people are buying their next car.”

Here’s a look at the key takeaways from Autolist’s latest study.

Frustrating and pessimism were common themes among respondents

51 percent of people said they found ‘less’ or ‘significantly less’ inventory than they expected.

Chart 1 Inventory levels (1)

Meanwhile, 40 percent of shoppers found this latest car-buying process ‘more frustrating’ than previous experiences; 31 percent found it ‘about the same,’ and 23 percent found it ‘less frustrating’ than previously.

Chart 2 Frustration

These experiences back up the data on current car inventories tracked by Autolist’s parent company, CarGurus. New vehicle inventories in August are on track to dip another 13.5 percent from their already-basement-level numbers in July -- putting them down 64 percent year-over-year.

Meanwhile, used inventories in August gave up some of their recent (but small) gains, dipping 4.5 percent from July but rising above August 2020 numbers (YoY) by 6 percent.

So how are consumers responding?

Based on this frustration, shoppers are adjusting what they’re shopping for, where they’re shopping for it, and when they plan to get it.

How consumers changed what they were shopping for:

Consumers are compromising on their vehicle choice due to inventory shortages.

Yet safety features were the one component of their next vehicle where consumers were least willing to compromise:

  • 31 percent are looking at brands they wouldn’t normally consider
  • 24 percent are looking at a different body style than they initially wanted
  • 22 percent are looking at a different size vehicle (larger or smaller) than they originally intended to buy
  • 22 percent of shoppers are also looking at different colors than they would normally choose
  • 19 percent are giving up amenities that they typically opt for (things like leather seats, a sunroof, navigation system, etc)
  • Just 8 percent of shoppers said they were giving up certain safety features that they had originally wanted

Chart 3 Vehicle consideration

How consumers changed where they’re looking for their next vehicle:

The inventory crunch has changed this too. 58 percent of respondents said that changed where they shopped this time around, in order to find the vehicle that they wanted.

Chart 4 Where shopping

The biggest behavior changes were:

  • 52% are spending more time online shopping
  • 42% are shopping at dealerships farther away than they would normally use
  • 22% are looking at cars at larger/smaller dealerships than previously
  • 20% are more likely to buy from a private seller than previously

How consumers changed when they’re getting their next vehicle:

“With new and used vehicle inventory -- and prices -- fluctuating each month, it’s understandable that shoppers might change their timing,” Lydstone said. “Whether it’s to delay getting a new car to see if prices come down, or get one sooner because you’re offered a great deal on your trade.”

Here’s a look at the impact of inventory levels on people’s timing for their next vehicle:

Chart 5 When Purchasing

  • 44 percent of respondents said that current market conditions were causing them to change their timing of this purchase
  • 29 percent said they were delaying the purchase; 15 percent were committing to the purchase earlier than planned
  • 29 percent of consumers didn’t plan on changing their timing
  • 27 percent of respondents were ‘Unsure’

Additional Survey Insights:

Autolist’s survey also found noteworthy trends among specific groups of respondents, including new vs used vs certified pre-owned (CPO) shoppers, age group, intended vehicle type, whether they were shopping more out of want or need, and whether or not they found this round of car-shopping to be a frustrating experience.

New-vehicle shoppers forced to compromise

Autolist’s survey also found that because new-vehicle shoppers are experiencing more inventory woes than their used counterparts, new-vehicle shoppers are more willing to change their minds during the shopping process.

New-vehicle shoppers are significantly more likely to consider different brands, different sized vehicles, and different vehicle body styles than used. Yet new buyers were the least likely to give up certain amenities that they had initially wanted.

Chart 6 New vs Used vehicle choice

Who’s the most loyal?

Traditionally, truck buyers are the most loyal in the auto industry, with more owners trading in their old truck for a new one from the same brand than any other vehicle segment.

Autolist’s study found that this remains the case, despite inventory challenges. Just 24 percent of full-size truck shoppers in this survey said they were considering a different brand as a result of poor inventory, the lowest of any major segment.

On the other end of the spectrum were shoppers looking at small sedans; this was the segment whose shoppers were most likely to consider different brands from what they initially intended, at 46 percent.

“It’s amazing how not even a historic shortage of vehicles can dampen the loyalty of truck buyers,” Lydstone said. “Meanwhile, on the other side of the coin are small-car shoppers, many of whom are need-based consumers so their loyalty is much more fleeting.”

These figures compare to the overall average of 31 percent of respondents saying they’re looking at different brands. Here’s a look at how shoppers in all segments responded:

Chart 7 Segments switching brands

  • Small sedan shoppers: 46 percent
  • Midsize sedan shoppers: 39 percent
  • Hatchback shoppers: 36 percent
  • Midsize crossover/SUV shoppers: 34 percent
  • Sports car/muscle car shoppers: 33 percent
  • Large sedan shoppers: 33 percent
  • Small crossover/SUV shoppers: 32 percent
  • Large crossover/SUV shoppers: 31 percent
  • Midsize truck shoppers: 26 percent
  • Full-size truck shoppers: 24 percent

Price-conscious Used shoppers feeling the squeeze the most:

Shoppers looking for new vehicles were significantly more likely to say they believed it’s currently a good time to get a vehicle, compared to those looking for used or CPO vehicles

'I believe it’s a good time to get a vehicle:'

  • 49 percent of new vehicle shoppers agreed
  • 30 percent of used vehicle shoppers agreed

The higher level of frustration by used-car shoppers is due to two related factors.

While it’s true that used vehicle inventories aren’t as slim as new vehicles, cheaper used vehicles (those that are under $20,000) have become much harder to find.

In 2020, vehicles under $20,000 made up almost half (48 percent) of used inventories; they’ve dropped to just 35 percent of used inventories in 2021, according to CarGurus’ data.

Yet Autolist’s survey found that used shoppers are looking primarily for vehicles under $20,000:

  • 73 percent of respondents who were looking for used vehicles said they were looking to spend under $20,000
  • Just 22 percent of new-vehicle shoppers plan to spend under $20,000

“This means that the biggest group of used-car shoppers has seen the biggest drop in available inventory,” Lydstone said. “Thus, used shoppers on a tighter budget really don’t feel like now is a great time to be buying a vehicle.”