Jeff Dyke: We do. For the fourth quarter you’re going to see it we got — we haven’t been over 10,000 units in stock and since 2019 and we hit that in this time frame. We were really constrained as Honda and Toyota the imports. The luxury manufacturers are doing a fantastic job. BMW were at about 18 days’ supply. Electric vehicles were at 26 for BMW. So we’ve got inventory to sell. And I think you see that in our sales. Hopefully, the strike is starting to be soft last night with Forbes announcement and they’re like – I mean they will follow each other and hopefully get this handled by the end of the year. And so I’m not too concerned. Inventory is going to continue to build. That’s why we’re so excited about EchoPark because it’s going to bring used car valuations down.
We’re seeing no sales at the auctions now in the mid-40% range which is a big deal. That means people are holding on for holding on. They’re going to have to start selling those cars. That’s going to bring pricing down. So we’re excited about the new vehicle inventory coming back but I don’t think it’s going to come back too far. I mean, I think, when we get to the highs not including electric. We’re just looking at highs maybe in the 30- to 35-day range versus pre-pandemic in the 65-day range. So I think it will stop there. There’s not a manufacturer out there saying that they’re going to bring inventory day supply up to some crazy number which I think is healthy. And it’s good for the used car business. That’s enough for us to get our job done from a pre-owned perspective both at EchoPark and on the Sonic side.
Leasing is coming back, which is great. We’re starting to see incentives there. Again we’re leasing a higher percentage of the portfolio now. Of course, that’s going to take 18 to 24 months and that will make a big difference. But inventory is getting better. If we had more Hondas and Toyotas on the ground we’d sell more Hondas and Toyotas. There’s no question about that. Those day supplies are still going to sub-10 for us but improving every month. And I expect that to improve greatly in this quarter that we’re in right now for those brands and others. We’re seeing — including BMW which is a big part of our portfolio we’re going to get more ICE vehicles more SAVs. That’s going to make a difference in terms of our new car volume for the rest of this quarter and going into 2024.
John Murphy: Encouraging. Thank you very much, guys.
Jeff Dyke: Yes, sir.
Operator: And our next question comes from the line of Michael Ward with The Benchmark Company. Please proceed with your questions.
Michael Ward: Thank you very much and good morning, everyone. Two things. On the inventory front, can you provide any details on the used vehicle inventory at both franchise and EchoPark?
Jeff Dyke: In terms of day supply?
Michael Ward: Yes. Where it sits?
Jeff Dyke: They’re both in the 30-day range. We try to keep 20 days’ supply on the lot and 10 days in the pipeline. We’re probably a little bit below that on the franchise side maybe 27, 28 days and we’re right at 30 in the EchoPark stores only, not including North West Motorsports or eCarOne. And so we’re in fantastic shape. Our inventory is young, margins are good. We’re in as good a shape as probably anybody out there in terms of our used day supply and our inventory mix.
Michael Ward: Yes. And on the franchise side with the inventory, you’re not forced to chase out in the outside. You’re either taking money trade-ins or the priority auctions? Is that what you’re looking — looking at?
