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Strategy

Car Inventory Shortages Can Lead to Promo Opportunities

With demand outpacing supply there are fewer vehicles in dealership lots, but opportunity still exists for savvy promo distributors.

Car sales have been dropping, but it’s not because Americans aren’t eager to buy.

The Commerce Department reported this week that automobile sales fell 3.9% in July, after declining 2.2% in June, according to Reuters. And MarketWatch reports production by car manufacturers is down 3.5% from a recent peak in January. The slowdown is mainly due to the global shortage of semiconductors – the chips that power the electronic innards of modern vehicles.

With fewer new cars on the market, buyers have been flocking to used vehicles, driving up prices. The average price of a used car in the second quarter of 2021 jumped to $25,410, a 21% increase year over year, according to data from car shopping experts Edmunds. Used car retailer Carvana delivered more than 107,000 cars in Q2 – a 96% increase compared to a year ago – and for the first time reported a profitable quarter, reports CNBC.

One way used car dealerships can help alleviate sticker shock is through targeted use of promotional products.

Auto kit

This auto kit (1440-1002) from Ready 4 Kits can help drivers with a variety of roadside issues they may encounter.

“I believe that auto dealerships should give something to anyone who purchases a car from them,” says Jennifer Tahaney, promotional sales manager at Ready 4 Kits (asi/80882).

Consider helping dealers put together a welcome pack that includes products like a logoed ice scraper, keychain, umbrella and other essentials. Ready 4 Kits offers several kits geared toward drivers. Its silver automotive kit (1440-1002), for example, is stocked with jumper cables, first aid supplies, an emergency rain poncho and more. The kit also includes a reference guide that gives direction on how to handle car, human and pet first aid, as well as how to be prepared for natural disaster emergencies.

Kits like these are appropriate for drivers of all abilities, as the products deliver “peace of mind, knowing they are prepared to respond in various types of emergencies,” says Tahaney.

In addition to logoed products, Tahaney suggests welcome packs be stocked with coupons for free inspection or discounts on tires, oil changes and filter changes; these would be redeemed at the dealership that sold the vehicle.

Some experts believe the chip shortage should improve over the next few months, which will help meet growing demand and potentially lower the price of used cars. “New car inventories are going to get better progressively over the next few months as we get to the end of the year,” Jeff Dyke, president of Sonic Automotive, told CNBC.

In any case, promo distributors can help dealers improve the car buying experience with fully stocked welcome kits, packed with memorable logoed items.