GM Back To Its Channel Stuffing Ways

Bertel Schmitt
by Bertel Schmitt
gm back to its channel stuffing ways

The Nikkei [sub] comes with the good news that “Japan’s automakers have finally resolved the inventory shortages that have hindered their sales in the U.S. market.” According to the Tokyo wire, Japan’s automakers “are in a better position to compete with their Western and Korean rivals,” now that lots are stocked again.

Well, not quite. Japanese inventories are still fashionably slim compared to some Detroit chubbos. Pop some Tums and have a look.

According to data compiled by Automotive News, Honda has a 54 day supply. Around two months are considered normal for the industry. Toyota however has only a 32 day supply, smaller Subaru has 30.

Let’s take this opportunity to look at all lots.

Days of supplyUnitsDays Apr 2012Days Mar 2012Detroit 3:1,534,9007072European231,3005342Japanese827,4004346Korean122,2002734

The Detroit 3 definitely have no shortage of cars with an average of 70 days’ supply on the lots. The Europeans are at the current industry average with 53 days of supply. The Japanese have 43 days’ worth on the lots, but “the Koreans” have only 27 days.

UnitsDays 1 Apr 2012Days 1 Mar 2012HYUNDAI-KIA122,2002734SUBARU35,0003033BMW32,3003033TOYOTA230,4003236PORSCHE3,6004141NISSAN226,4004754JAGUAR LAND ROVER9,2004748DAIMLER AG44,5005145HONDA244,0005450MAZDA62,3005459Industry5457FORD477,3006068CHRYSLER GROUP354,9006166VOLVO15,0006366VW GROUP116,2006742SUZUKI6,8007268GENERAL MOTORS713,2008680MITSUBISHI22,50088125TOTAL2,715,8005457

Indeed, Hyundai-Kia’s supply is the lowest of them all with only 27 days until empty. As indicated by the Detroit 3 number, American makers are generously stocked, but averages can be deceiving.

Ford and Chrysler carry a regulation two month supply on the books.

The absolutely worst of Detroit is GM with a nearly three month supply. Only consolation: Deadman walking Mitsubishi carries two days more. While days to sell are down industry-wide, inventory is increasing on GM lots: From March to April, it took a week longer to move an already sluggish inventory.

GM’s lot queens: Escalade EXT (144 days), Yukon (136 days), Yukon XL (133 days), Sierra (132 days), CTS (124 days), all Cadillac cars (123 days), all Buicks (121 days).

Have a look at this chart: No wonder that GM is losing market share. The cars are all sitting on the lot.

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6 of 51 comments
  • Dave M. Dave M. on Apr 15, 2012

    What the hell is the deal with the constant denigrating of GM? Because they should know (have known) better. The world was their oyster, and despite warning signs for decades they continued to turn out substandard, irrelevant product. It took Uncle Sugar to help set them straight. Anyway, no one I know 'aspires' to a GM. They are either very targeted work vehicles (Tahoe boat towing, Chevy work truck, etc), or 'best deal, entry level' default vehicles. Yes, they build some very competent, competitive vehicles. But the parade has passed, and the Toyota/Honda/VW/Hyundai float is getting all the attention. Finally, you have moralists like me. Been screwed by GM crap long ago; never have and never will look at their products again. I work too hard for my money.... But in 30-40 years my generation will be gone, so maybe they have a chance.....

    • Highdesertcat Highdesertcat on Apr 15, 2012

      GM as we know it today won't be around in 30-40 years. GM as we know it today won't even be around by 2016, analysts have predicted. What these same analysts predict is that GM will have morphed into something more akin to what Ford under Alan Mulally is today, having divested itself of its excess baggage and models, by a refocus on its corporate goal. I'm skeptical, but we'll see. It can't get any worse than the past 3-4 years have been for GM. But what remains to be seen in as little as 3-4 years is if the American public is willing to accept the evolving GM and buy the remaining GM products in sufficient numbers for GM to return to sustained profitability. So far, GM's market-share won't get it there especially when considering Opel, the French connection and the Chinese liaisons. Since GM sells a huge portion of their production to fleet and rental sales which negatively affects the future used-car market, I don't see anyone standing in line to buy a year-old GM rental car, no matter how low the price. Maybe GM should consider what some analysts have suggested to instill confidence by providing a 10-year/100,000-mile bumper-to-bumper warranty. It worked for Hyundai. It might just work for GM providing the UAW doesn't drive GM into bankruptcy again. But as long as the taxpayers have their back, how can GM possibly fail? GM will receive on-going bail outs in the form of special treatment, accounting privileges, and tax accommodations just to keep the heartbeat of America going and the UAW working. Whether anyone besides the diehard GM loyalists buy into that is highly doubtful, both here and abroad. Big changes ahead.

  • Doctor olds Doctor olds on Apr 15, 2012

    GM has a weak month, and now is on death's door? Just illogical and ignorant of facts. It has been said that market share is good for bragging rights, but volume makes the money, and GM's volumes are still rising here, and more so around the world, and they sure are making money- $9.2B last year despite losses in Europe. Globally GM is solidly #1, outselling #2 VW by nearly a million units and #3 Toyota by over 2 million units. You would not have to be the sharpest tack in the box to see through VW's hype about a couple hundred thousand trucks bridging the gap. It was not even close. Before anyone questions including joint venture China volume they should understand that VW gets about the same % of its globally volume from joint ventures there as well. GM wins, even over Toyota and VW if you just exclude all of their China volumes all together. Most importanly, GM has generated consistent profits with the all time record operating profit last year. In fact, GM's operating profit ranks near the top of any auto company every in history. Betting against them surviving would be a poor and uninformed bet. As for the taxpayers having their back- good political rhetoric, but completely ignorant of reality. There is no ongoing support for GM and with the new cost structure, there will not be any need.

    • See 2 previous
    • Highdesertcat Highdesertcat on Apr 16, 2012

      @highdesertcat Yeah, yours is not the only story like that. One of the Chaplains I knew from my Air Force days, now in his 70s, was heavily entrenched in GM and Chrysler stock at the end of 2008. Like me, it took him a little time to decide to divest from American Auto because it had always been such a secure holding. He lives in an apartment now, instead of a house. His beta-risk was heavily skewed toward American Auto. He lost a great deal of lifetime savings/investments and now lives on social security and AF retirement pay. I got out of stocks/bonds/Treasuries mid-2007 to mid-2008 largely due to the urgent insistence of my broker. It took me until mid-2007 to decide for myself to cash out and cash in rather than ride the fickle finger of fate. The reason I was so hesitant to divest was because I would not turn 62 until 2009 and could not get social security retirement until then, to supplement my military retirement. In my case it all ended well, so all's well for me. For others not so much.

  • Tassos VW's EV program losses have already been horrific, and with (guess, Caveman!) the Berlin-Brandenburg Gigafactory growing with leaps and bounds, the future was already quite grim for VW and the VW Group.THis shutdown will not be so temporary.The German Government may have to reach in its deep pockets, no matter how much it hates to spend $, and bail it out."too big to fail"?
  • Billccm I had a 1980 TC3 Horizon and that car was as reliable as the sun. Underappreciated for sure.
  • Inside Looking Out I did not notice, did they mention climate change? How they are going to fight climate change, racism and gender discrimination. I mean collective Big 3.
  • Lou_BC I'm not too picky about gloves. If I'm concerned about heavy oil or grease contamination, I'll donn nitrile gloves. Heavier work and I'll use "old school" leather gloves, fake leather, synthetic or whatever is available.
  • Dusterdude Getting the popcorn ready . May be a good plan for strikers to make sure they own good winter jackets for future pickets .