After months and years of struggling to move their inventory, dealerships are faced with an equally frustrating situation to squeeze new vehicles out of GM. You wouldn’t think that a shortage of vehicles on dealership lots or demand that exceeds production would be a serious issue for General Motors these days, but that is exactly the situation being reported by dealers.
Contrary to perception, and as a direct result of GM’s strategy to trim down inventories from 120 day supply to a 75-90 day supply, some dealers are grumbling at the low levels of profitable trucks and SUVs on their lots. Despite requests for more vehicles, GM doesn’t appear to be in a position to build more as many plants were closed for an extended summer shutdown, and only began production again this week.
In June 2008, GM reported an inventory level of 788,000, over 200,000 more vehicles than 581,000 units reported for June 2009. Shortages have specifically affected the GMC Yukon and Sierra trucks, the Buick Enclave, and the GMC Acadia. GM’s response is not likely to change the situation, despite reopening truck plants recently. In short, they are suggesting that dealers swap inventory between themselves to satisfy demand. to fill any inventory shortages. This situation will no doubt trickle down to consumers who will not have the leverage to negotiate a better price from dealerships who have historically been eager to move vehicles.