Jump to content

GM OK With Its Excess Inventory


NINETY EIGHT REGENCY

Recommended Posts

GM OK With Its Excess Inventory

General Motors started this month with a 93- to 95-day supply of vehicles to sell, more than 50% more than analysts' recommended 60-day supply, said Jim Bunnell, who manages GM's dealer network and sales support.

The company has its reasons, Bunnell said. It expects sales to pick up next year, and it wants to make sure to have enough inventory to meet demand.

"As you look out into 2011 and you see strong demand ... we don't want to leave anything on the table," he told reporters and analysts last week on a conference call.

The automaker still needs to beef up inventories of its Chevrolet Equinox, GMC Terrain, Cadillac CTS coupe and SRX, and Buick Regal, Bunnell said.

Coming up: GM is nearing the sale of its last Pontiacs and Saturns. As of Wednesday, it had 58 Pontiacs and six Saturns left unsold in the U.S. It's already out of Hummers.

Read more: Shareholder to donate car | freep.com | Detroit Free Press http://www.freep.com/article/20101205/BUSINESS01/12050463/Shareholder-to-donate-car#ixzz17LdGrwXy[/b][/size]

Link to comment
Share on other sites

REVERTING TO OLD WAYS? INVENTORIES GROW AT GM

By Andrew Ganz

Analysts are showing concern over the growing numbers of new cars showing up in General Motors’ unsold inventories.

Before Detroit’s Big 3 crumble turned into disaster a few years ago, Chrysler, Ford and GM routinely built more cars than they could reasonably sell, resulting in a glut of new car inventory at dealers. As the crisis worsened, all three automakers pledged to reduce inventory levels in an effort to increase value and help dealers remain profitable.

Now, it looks like all three automakers are reverting to their old habits. GM has a 95 day supply, up from 76 days in August. Chrysler has a 79 day supply. Ford has a 71 day supply.

The industry average? According to Citi Investment Research and Analysis, it’s just 67 days, although it will likely trail off to 60 days by the end of December as assembly slows down over the holiday season. It is also not unusual for automakers to build up inventory ahead of December, but analysts tell the Detroit News that these hefty inventories are a potential red flag.

GM says that it is anticipating strong demand for end-of-the-year deals this month, but the automaker risks having too much inventory if its plan fails.

“If they don’t get it [strong sales], then Wall Street will punish them in January,” said Warren Browne, a retired GM executive who now runs his own firm as an analyst, WP Browne Consulting LLC.

Dealers have reported inventory shortages for some popular models, like the Chevrolet Equinox, Chevrolet Cruze, Buick Regal and GMC Terrain, but analysts say they are concerned about a build up of less popular models. That might spell huge discounts to clear inventory in the near future if GM’s intended sales push doesn’t succeed.

LINK:

http://www.leftlanenews.com/reverting-to-old-ways-inventories-grow-at-gm.html

Link to comment
Share on other sites

Join the conversation

You are posting as a guest. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.



About us

CheersandGears.com - Founded 2001

We ♥ Cars

Get in touch

Follow us

Recent tweets

facebook

×
×
  • Create New...