Automotive News shows us that automakers are nevertheless shy about making cars despite the economic c climate of recession and also the taxpayer auto bailout with it. It seems like the times have changed. Now and days it is more common to see low factory inventory. The result of this is that dealers need more cars to sell, as they can’t meet increasing demand. An online survey found that more than 160 of 244 responding dealers – representing the spectrum of automotive brands – had too few autos to sell. Less sales were made because of this.
Dealers losing buyers over low inventory
Numerous dealerships are reporting that motivated buyers are leaving discouraged over low inventory. Not enough GMCs, Hondas, Hyundais, Chevrolets or other autos are available, which constitutes a wide portion of the automotive spectrum. One dealer told Automotive News that automakers “have driven supplies too low,” yet dealers like him are certain they could sell more if stock was accessible. Auto dealers aren’t having an easy time getting cars like the GMC Terrain from companies like General Motors, Ford and even Chrysler. This has made dealers run out of the popular cars quickly. Dealers are worried that that automakers may be cutting too much.
Factories help
Overproduction could be really bad for an automaker trying to stay in business. Despite the fact that helping dealers is really essential, it is also significant to keep them going. Dealers are nervous too. They’d rather sell all the cars than get more cars than they can sell. GM spokesman Tom Henderson talked to Automotive News and said that it is a time to avoid high incentives with low resale value right now. Some adjustments are necessary, of course. For instance, in order to meet recent demand for the Chevrolet Equinox and GMC Terrain in some areas, General Motors renovated an unused area of an Ingersoll, Ontario, manufacturing plant so that more bodies can be made. Since there’s no room for the bodies on the assembly line under the current production schedule, nevertheless, GM is sending the new bodies to one more plant located two hours east for paint and finish.
Further reading
Auto News
autonews.com/article/20100823/OEM01/308239949/1262
