Lot Rot

Lot rot refers to the combination of market value depreciation, floor plan interest, reconditioning costs, and opportunity cost that erodes the potential profit on a vehicle the longer it sits unsold.

Most dealers set a 45- to 60-day threshold before taking aggressive action on aged units. Strategies include price reductions, increased marketing, wholesale transfers to other rooftops, or wholesaling the unit at auction. Identifying and acting on aging inventory early is a key skill for used vehicle managers.