U.S. new-vehicle inventory ended May at a two-year high of 1.96 million, up 73% from a year earlier, as consumer demand waned, Cox Automotive reported.

Days’ supply ticked up by one to 55 by month’s end, 46% higher than a year earlier, it said. Cox puts 60 days is the historical normal.

“The month of May ended on a slightly less positive note than when it started, suggesting some weakening of demand,” said Cox Senior Economist Charlie Chesbrough.

“Sales for new vehicles began to decline near the end of the month, after rising throughout the month as supply continued to increase. That caused days of supply, which is based on active supply and the daily sales rate, to edge higher.

Meantime, prices for new vehicles slipped, another indication of slightly weaker demand.”

Inventory is still low by historical standards, Cox said. It stood at 2.99 million, or 92 days' supply, in May 2020, before the pandemic-influenced chip shortage choked off supply chains.

May’s new-vehicle sales surged by 23% year-over-year, partly on strong sales for fleets, Cox said. The seasonally adjusted annual rate, or SAAR, was 15 million, beating analyst forecasts.

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