For years GM’s inventory levels have been a major cause for concern. Falling market share lead to overproduction which lead to incentive addiction and falling profitability as GM tried to help its dealers clear their lots. But now that GM has cut production to the bone during its bankruptcy, dealers are beginning to complain to Automotive News [sub] that “right-sizing” is leaving them short on crucial truck and CUV models. GM’s summer shutdown ends on the 13th of July, but a rolling restart means some production won’t come back online until August. In the meantime . . .
Dealers are reporting as little as a single month’s worth of Lambda CUVs like Acadia and Enclave. GM is adding another shift to Acadia/Enclave production at Delta Township, but not until the 24th of August. Meanwhile, Silverado, Yukon and Sierra are also in short supply, especially the extended- and crew-cab pickups. But even with the Camaro at a just-launched supply of six days, GM’s overall inventory levels show a ninety-day supploy of vehicles. Which means losers are clogging up lots while more popular products can’t be found.
GM’s current 90-day supply translates into a total of 581,000 unsold vehicles. That’s way down from the June ’08 number of 788,000, but there’s still some cutting to do before GM reaches its stated inventory goal of half a million vehicles. Which means availability issues could get worse before they get better. And further proves that deeper, faster, lean-ness isn’t always the answer.
With trucks making up only 41 percent of GM’s current inventory, it’s no wonder customers are having a harder time finding certain of the more popular configurations. GM spokesfolks say that GM had planned to emphasize cars and crossovers, and that a recovery in pickup and SUV demand is a welcome sign that the economy is improving. But if GM isn’t nimble enough to offer those customers willing to darken their dealerships’ doors with the products they want, well, what’s the point?
Meanwhile, the Washington Post‘s Charles Lane opines that dealers are figuring out that they need to keep up a healthy presence in Washington to balance the OEM’s attachment-at-the-hip to the federal government. With the Automobile Dealer Economic Rights Restoration Act of 2009 under consideration, dealers cut by Chrysler and GM could be reborn in the grace of the federales, a result which would likely cause GM’s inventories to head back upwards. Lane imagines the day when automobiles can be ordered online, and argues that
“Dealers claim to perform all sorts of valuable services — dealer “prep” and the like — that no one else could replicate. If so, they should be unafraid of competition. If not, they are exercising political clout at the expense of the car-buying public.”
But hey, who isn’t these days?
The pic must be from a Ford lot. I see a lot of Ka, Fiesta and Focus there.
No-hassle pricing without additional gimmicks is the way to go. I hate the funny money dance when car buying. I, for one, don’t believe any numbers called MSRP, dealer invoice, etc.
Trade-in values could be negotiated and locked in separately.
At one point there was something like a 400 day supply of Aveo’s.
What percentage of GM’s 580K cars in inventory are Aveo’s and and the like?
If you have 100K Aveo’s et al that will NEVER sell sitting around, you have a serious problem.
Dumping them for nothing to clear the inventory will just steal sales from other cars.
yeah but stealing sales from toyota or hyundai is a good thing
breaking even is better than the opposition making money
How about losing money? Is that better? That’s what were talking about with the fire sale of cars like the Aveo.
The whole situation shows that GM is unable to respond to customer demands, and they are unable to accurately judge the market for the various vehicles they offer. nothing new there.
I get a kick out of clowns who talk about no haggle pricing…. Like its a good thing, If you want no haggle pricing then walk up to the window sticker and add your sales tax like they do at Toyota. At least the domestic dealers will playball with you when you want a better price
So we have a short supply of trucks and SUVs, but car lots overfilled with compact cars? But according to, let’s just say certain politicians, Americans don’t want trucks and SUVs, they want small, fuel efficient vehicles. More proof, as if we needed it, that in regards to the auto bailout the blind are leading the blind.
@ Superbadd: Aveos are horrible cars, and not very fuel efficient considering their size.
Ive got a question….
Does anyone go out and start these cars regularly? I mean, cars arent designed to be built and sit for long periods of time unused. Id be very hesitant to buy one of these. Well, honestly, I wouldnt buy one anyway, but you know what I mean. :)
Of course the most popular inventory is what has been sold off, and the less appealing stuff is what is left. There are plenty of Astras available and the discontinued Pontiacs are stacking up at dealers everywhere.
“If you want no haggle pricing then walk up to the window sticker and add your sales tax like they do at Toyota.”
Hmmm, that isn’t how Toyota dealers work around here. Submit a request for quote via email to the fleet/internet manager at any Toyota dealer around here and you can easily get a Prius for a few hundred off MSRP or a Sienna for many thousands off MSRP.
Autonews hasn’t published the July 1st inventory yet, but I do see that as of June 1st there was a 380 day supply of Aveo’s and 430 day supply of its cousin the G3 (about 35K on hand to start and they sold about 2700 last month).
You can tell that they are getting tight on Enclaves and Acadia’s, if the dealers were team players they would shoot them over to the Chevy store where they started june with bunches of the Traverse. The Malibu is also tight but take your pick of the CTS
The sarcastic side of me wonders if, instead of “Cash for Clunkers,” maybe there should be a program to crush stale new-car inventory that nobody wants?
“Americans don’t want trucks and SUVs, they want small, fuel efficient vehicles.”
Plenty of Americans want trucks and SUVs, too. Maybe not where you live.
“6 day supply of Camaros” They must be selling 1000 a day, because I drive by 1000’s of them every week and they aren’t moving very often or fast from the plant in Oshawa.
From what I observe, the local yokels in southern Missouri are spending their money on body adornments such as tattoos and piercings leaving little to no money for vehicle purchasing.
obbop’s point is an interesting one. The under 30 year old people I know have minimal interest in cars. They may have one, but it is more of a gotta-do thing than it is an object of desire. Young people by and large are much more emotionally involved with their choice of cell phone, music player, computer, video game or latest “body art” than they are with their car.
“The under 30 year old people I know have minimal interest in cars. They may have one, but it is more of a gotta-do thing than it is an object of desire. Young people by and large are much more emotionally involved with their choice of cell phone, music player, computer, video game or latest “body art” than they are with their car.”
And in Europe it is exactly the same. Cars are sooooo 2000 dahling!! Electric bikes and public transport are I am afraid, the way things are currently going, and with everyone realising DEBT IS BAD I can’t see this quickly changing!! Mainly because I know of no one under 40 that could right now pay out more than $10,000 cash for a car!!!
sutski :
July 7th, 2009 at 4:03 am
“The under 30 year old people I know have minimal interest in cars. They may have one, but it is more of a gotta-do thing than it is an object of desire. Young people by and large are much more emotionally involved with their choice of cell phone, music player, computer, video game or latest “body art” than they are with their car.”
And in Europe it is exactly the same. Cars are sooooo 2000 dahling!! Electric bikes and public transport are I am afraid, the way things are currently going, and with everyone realising DEBT IS BAD I can’t see this quickly changing!! Mainly because I know of no one under 40 that could right now pay out more than $10,000 cash for a car!!!
I’ve heard the same thing about younger Japanese. It looks like the next generation doesn’t look at transportation as a status item. Which, when you think about it, is a good thing. My 16 year old son currently has little interest in driving and only drives because “he knows he needs a driver’s license”. I wonder if he’ll even own a car in the future?
^I’m okay with the under 30 crowd having no interest in cars. Leave the roads to the over 30 crowd and they can take the bus or have mom drive them to buy their new video game. ;)
Anyway, on my local news this morning, I heard that GM is starting back up truck production at some nearby factory (in Indiana). I was honestly surprised.
Pondering placidly.
Possibility.
Perhaps.
Back in “the day” we had to drive or hitchhike or somehow leave the groovy pad and transit to “where the action is.”
Nowadays, what with the Web, the younguns can get to “the action” using their electronic brain and all those tubes the internet runs through.
A world of action at their fingertips with no curfew, having to exert themselves physically (missing a ride from the party in another town when 16 I had to walk 12 miles to get home, etc)having to cough up gas money, not having public transportation available, etc. etc.
Is there a possibility that the Web contributes to a shift in youth attitudes towards vehicles?
Sure, not the only reason.
Increasing costs must have an affect.
Just peek at the cost of minimum liability insurance in many areas for youthful drivers.
The socio-economic class I was raised in couldn’t afford today’s insurance rates.
Then there’s the barrage of brainwashing regarding “Green” and planetary warming and a host of other mantras that may be factual or false or somewhere in-between but the indoctrination leads to fad-like behavior and changes in habits and thoughts, perhaps affecting enough youth to make carlessness a neato nifty cool and pert-near groovy life-style to grab onto.
Not that there’s anything wrong with that.
Pondering possibilities concluded.
Film at eleven.
Or 24/7 via HeyYouTube or one of a plethora of venues that did not exist when the delicious 440-six-pak machine hit the showroom.