By on May 16, 2017

Chevrolet Traverse 2018

Like floodwaters pooling in a reservoir, unsold General Motors vehicles are getting close to breaching the dam. Not since November 2007 has the automaker held so many vehicles in reserve, though GM claims there’s nothing odd about the buildup.

With several updated models either imminent or on the way, it would make sense for GM to stock up in order to keep dealers and customers happy during production gaps. In this case, however, the numbers don’t seem to add up.

GM executives tell Automotive News the buildup, which is 37-percent higher than this time last year, is meant to keep a healthy supply of certain models in stock as it preps for next-generation vehicles. Several assembly plants will undergo retooling this fall, the executives claimed, with inventories falling to normal late this year.

As of May 1, GM has 934,3000 units filling its inventory — a 100-day supply of light trucks and a 97-day supply of passenger cars. The generally accepted optimum number is 73 days’ worth. AN notes GM vehicles now account for 22 percent of the entire U.S. vehicle inventory, despite the automaker’s 17.1 percent market share.

While certain models scheduled for renewal — the Chevrolet Traverse and Silverado, Buick Enclave and GMC Sierra, to name a handful — show up in increased numbers compared to April’s tally, those models don’t account for even half of the automaker’s inventory growth.

GM’s mid- and full-size SUVs are expected to undergo a refresh for 2018, not a full redesign, but the number of Chevrolet Tahoe, Suburban, GMC Yukon and Yukon XL models are up. Other models, including the Buick LaCrosse, GMC Canyon and Cadillac XTS, are also up, while others sit well above the industry average. This raises the possibility of more profit-sapping incentives to come.

GM’s chief financial officer, Chuck Stevens, claims the automaker will whittle its inventory down to a 90-day supply by the end of June, adding it’s nothing out of the ordinary. By the end of the year, he said, the company expects to boast an optimal 70-day supply.

[Image: General Motors]

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16 Comments on “Nothing Odd About This Sky-high Inventory Buildup, GM Claims...”

  • avatar

    all we need is 22% market share and problem solved.

    Return to Greatness anyone?

  • avatar

    Obviously my advice on product doesn’t match what consumers want, boring sells like there’s no tomorrow.

    But I’m getting the Chevy SS bug again, it’s been a week since the last American destined Commodore rolled off the assembly line. The wonderful purr of the LS3 backed by a precise Tremec TR6060 – sent out back to a limited slip differential is too much to resist.

    For the low price of $47k you can own the SS, or for $47k one can buy a Chevy Traverse (or siblings), a Decontent CT6 with a horrid engine choices or the ATS or CTS – again with less than thrilling engine options. $47k can also get you into a 3-series with a miserable turbo 4cyl.
    Don’t anyone tell me we’re at the high point of automotive availibility.

  • avatar

    “Nothing to see here, please disperse.” – Frank Drebin, Police Squad

  • avatar
    SCE to AUX

    “GM’s chief financial officer, Chuck Stevens, claims the automaker will whittle its inventory down to a 90-day supply by the end of June, adding it’s nothing out of the ordinary. By the end of the year, he said, the company expects to boast an optimal 70-day supply.”

    This means that GM sales suddenly need to jump about 5-10% YOY, or production needs to fall by that amount, or a combination of both. Unlike Ford, I’m not hearing much from GM about them cutting back on production.

    The factories will keep rolling, and the year-end sales will be impressive.

    • 0 avatar

      How many 20% MSRP sales can you have? maybe will see 30-40% by the end of the year.

      • 0 avatar

        Any automaker destroys their own credibility and pricing strategy when putting so much money on the hood in order to move the vehicles.

        That’s why I have always advised people who seek MY input about buying a new car to ask the sales manager, “What do you have to sell this thing for and still make what you need to make?”

        Then be willing to walk away from “The Deal” if the buyer is not comfortable with the out-the-door all-inclusive price.

        It won’t be the last time that dealership talks to you. They will hound you once you walk away because they NEED to sell in order to make money and stay in business.

        They invested time in dealing with you. If you don’t buy, they won’t recoup that time. Nobody likes wasting time.

      • 0 avatar

        The 30% off MSRP deals can found if you don’t mind shipping to your door. Just takes a few months of sesrching.

  • avatar

    There’s nothing odd about this is because it’s the norm for GM.

  • avatar

    I bought a 1983 Cadillac Eldorado Biarritz from Copart in San Jose for $125. No rebate required. 64,639 miles and runs like new. Got the good version of the 4100, of course! Also, a 1985 Oldsmobile Toronado with 68,250 miles, for $575. No dealer incentives needed here.

  • avatar

    If they need 20% off sales to keep inventories at these elevated levels, I guess 30% off is around the corner. A $20,000 Malibu hybrid might have some appeal….

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