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GM Channel Stuffing Hits Record In April

Tyler Durden's picture


Earlier today, GM posted better than expected April car sales, with total US sales up 26.4% on expectations of 14%. How much of this is due to a Toyota impairment is unclear. What is clear is that channel stuffing at Government Motors, whose Chinese sales are far more important than US sales these days, just hit a new all time record of 577,000, higher than the previous record of 574,000 from March, and 149,000 higher compared to a year ago. The good thing is that GM will never be able to complain about lack of inventory: it now has two and a half months worth of sales equivalent parked on warehouse financed dealer storefronts, in the form of rapidly depreciating autos.


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Tue, 05/03/2011 - 11:22 | 1234049 LRC Fan
LRC Fan's picture

This is certainly Bullish

-Phil LeBeau

Tue, 05/03/2011 - 11:31 | 1234074 dbach
dbach's picture

It could mean they are expecting a pick up in sales. Why they would believe that is beyond me though. What's the standard inventory held at a dealership? Judging from the Honda dealer across the street it is at least a few months worth...

Tue, 05/03/2011 - 12:31 | 1234509 BS_Merchant
BS_Merchant's picture

Bullish for GM - all those pristine assets sitting on forecourts appreciating.

That’s what happens to assets when inflation runs riot, doesn’t it?

Tue, 05/03/2011 - 11:25 | 1234054 LawsofPhysics
LawsofPhysics's picture

Should I leave my garage open so they can stuff that full too?  Just saying.

Tue, 05/03/2011 - 11:31 | 1234093 NotApplicable
NotApplicable's picture

Coming Soon! A pricing plan you can't refuse.

Congress will outlaw any car older than X years old, but to make up for it, they will distribute GM inventory to the masses with 1$ scratch-off tickets in payment for your now illegal trade-in.

So, instead of an old pickup truck, American trailers will have a shiny new Camaro in the drive, right next to the broken TV and the toilet that your fat-ass sister inlaw busted.

Ain't America Great!

Tue, 05/03/2011 - 11:58 | 1234227 r101958
r101958's picture

Sounds like what they do with car insurance in Japan. Surprised they haven't tried that yet.

Tue, 05/03/2011 - 11:27 | 1234059 Problem Is
Problem Is's picture

Stuffed Inventory = Car Sales...
Is tax payer backed GMAC still offering no money down liar loans?

Maybe I can gets me a Volt...

Tue, 05/03/2011 - 11:35 | 1234097 Cognitive Dissonance
Cognitive Dissonance's picture

Stuffed Inventory

Are we talking about car sales or S&M sexual practices?

Either one is OK with me. I just want to make sure I'm on the same page as everyone else.

Tue, 05/03/2011 - 11:38 | 1234134 hedgeless_horseman
hedgeless_horseman's picture


Mike Flannery
Flannery Ford

Bring your wife and title in
and we'll dicker.




Tue, 05/03/2011 - 11:58 | 1234220 Spastica Rex
Spastica Rex's picture

You said "dick-er."

Tue, 05/03/2011 - 11:57 | 1234234 FeralSerf
FeralSerf's picture

Is that "dicker" or "dick her"?

Tue, 05/03/2011 - 12:10 | 1234330 Cognitive Dissonance
Cognitive Dissonance's picture

Depends upon the ultimate deal struck.

Tue, 05/03/2011 - 11:24 | 1234061 TruthInSunshine
TruthInSunshine's picture

GM has NOTHING on The Dynamic Duo of Bernank-Jeetner, who are channel stuffing tens of billions each month.

Tue, 05/03/2011 - 11:31 | 1234091 Problem Is
Problem Is's picture

Nice link Drag:

"General Motors Co. reported a 26% surge in April vehicle sales... helping to push the company’s stock back above its initial public offering price."

Yeah that explains it...

Tue, 05/03/2011 - 11:29 | 1234080 ReallySparky
ReallySparky's picture

Can't layoff those union workers, that would be bad publicity.

Tue, 05/03/2011 - 11:37 | 1234083 hedgeless_horseman
hedgeless_horseman's picture

I would love to see a historical chart of the % of sales to government fleets.

All .gov employees in my town are driving brand new GMs funded by the 50% of us that pay taxes.

Two things I don't imagine I will ever be.  A government employee, and a GM driver.

Tue, 05/03/2011 - 11:33 | 1234086 gkm
gkm's picture

My parents just went and bought a used car from a GM dealer.  Apparently they couldn't find a parking spot on the dealer's lot due to the inventory.  

Tue, 05/03/2011 - 11:33 | 1234088 NOTW777
NOTW777's picture

socal lots are bulging

Tue, 05/03/2011 - 11:30 | 1234089 SDRII
SDRII's picture

Ally finanical (Q1)


dont look behind the curtain

#1 overall U.S. auto lender



– U.S. originations of $11.6 billion, up 25% from 4Q10

U.S. consumer originations up 25% quarter-over-quarter and 93% year-over-year




Tue, 05/03/2011 - 11:30 | 1234090 Cognitive Dissonance
Cognitive Dissonance's picture

Once again we find that the old tricks are still the best tricks........until they aren't. The great thing about moral hazard is that you never pay the consequences for the tricks you play.

Let the games continue.

Tue, 05/03/2011 - 11:58 | 1234243 r101958
r101958's picture

Seems something like Atlas Shrugged.

Tue, 05/03/2011 - 11:34 | 1234094 Ruffcut
Ruffcut's picture

It worked a while krispy Kream Donuts.

Ok, I'll let them stuff a couple in my garage.

Tue, 05/03/2011 - 11:35 | 1234112 Cognitive Dissonance
Cognitive Dissonance's picture

Krispy Kreme Donuts? Just be careful when backing up. They are a bit messy when run over. :>)

Tue, 05/03/2011 - 11:35 | 1234098 Jim B
Jim B's picture

Pay me now or pay me later.....

Tue, 05/03/2011 - 11:33 | 1234101 Seasmoke
Seasmoke's picture

and just think GM dealers fought to keep their dealerships open.....who is paying the floor plan for these clunkers

Tue, 05/03/2011 - 11:40 | 1234146 chunkylover42
chunkylover42's picture

of course they fought to keep dealerships open - where else were they going to put cars that nobody wants to buy?

Tue, 05/03/2011 - 11:46 | 1234164 topcallingtroll
topcallingtroll's picture

You misunderstood. Dealers fought to stay open. Government motors fought to close them.

Tue, 05/03/2011 - 11:34 | 1234105 Don Birnam
Don Birnam's picture

Seeing that GM obviously cannot sell updated product, perhaps they should simply declare defeat -- and go Old Skool. At this point, Government Motors has little else to lose -- hey, the Seventies are chic these days. Retool and re-issue an American classic. 

Can you drive a five-speed in plats, is the question.

Tue, 05/03/2011 - 11:39 | 1234121 Cognitive Dissonance
Cognitive Dissonance's picture

I bought that exact year and model for my ex wife.

Maybe that's why she's my ex. :>)

Tue, 05/03/2011 - 11:53 | 1234162 Don Birnam
Don Birnam's picture

Was it in this fashionable Polyester Pea Green with the creme racing stripe, and Midnight Black vinyl seats ? Perhaps you should have splurged the big bucks on her, and gone with the Chevy Vega instead. 

Tue, 05/03/2011 - 12:14 | 1234258 Cognitive Dissonance
Cognitive Dissonance's picture

I bought the Vega for myself, the black wagon with a stick shift, mag wheels and the shitty all aluminum engine (no steel cylinder liners) that was already burning oil as I drove it over the dealership curb. I was young, poor and stupid, stupid, stupid. Not much has changed since then except the young thingy.

Maybe that's why I'm the ex-husband. :>)

Tue, 05/03/2011 - 12:36 | 1234539 Don Birnam
Don Birnam's picture

From the CD photo album...

"My First Day With the Vega - 1977"

Tue, 05/03/2011 - 12:46 | 1234596 Cognitive Dissonance
Cognitive Dissonance's picture

At first the smoke was white. After the odometer turned the first 1,000 miles it was all down hill from there.

Tue, 05/03/2011 - 13:35 | 1234850 Clamdigger
Clamdigger's picture

It's possible your Vega was electing a pope.

Tue, 05/03/2011 - 14:04 | 1235009 Cognitive Dissonance
Cognitive Dissonance's picture

As the dealership informed me "They all do that". :>)

Tue, 05/03/2011 - 14:36 | 1235197 Bagbalm
Bagbalm's picture

I had the same thing. Pulled the engine and strapped the block on the boring mill - hogged out the cylinders and heated the block up with a torch. Had four nice steel sleeves in the shop freezer and slid them home. They warmed up and were tight as can be - was an excellent engine after that.

Tue, 05/03/2011 - 11:41 | 1234157 topcallingtroll
topcallingtroll's picture

Now that is a great idea!

I would consider a two ton 8 cylinder all steel roadmonster.

Tue, 05/03/2011 - 11:55 | 1234210 Don Birnam
Don Birnam's picture

I'll suggest a limited run of this little jewel. 

1966 GTO...with the 389 Tri-Power V-8.

Tue, 05/03/2011 - 12:23 | 1234450 ebworthen
ebworthen's picture

The men who conceived and built beautiful machines like that are dead and gone; replaced by iPud thumbing pussies using Lego plastic and Mexican junk parts to slap together computerized spaghetti vacuum hose wunderclunkers.

Tue, 05/03/2011 - 12:37 | 1234548 topcallingtroll
topcallingtroll's picture

Could not have said it better myself.

Tue, 05/03/2011 - 12:41 | 1234587 Don Birnam
Don Birnam's picture


It's essentially CAD software now. Very little else. 

Tue, 05/03/2011 - 13:07 | 1234684 topcallingtroll
topcallingtroll's picture

I would be first in line.

The SS Impala comes close but is still not the funmobile of a 60's GTO.

Wed, 05/04/2011 - 02:06 | 1237153 ebworthen
ebworthen's picture


My 65 GTO was soooo nice.

Other than the "slip and slide powerglide" 2-speed automatic, but I grew to like it.

That thing had so much torque that a two speed automatic was all it needed.

The hood was so big and so long it was like steering a boat.

And the back seat, did I tell you about the back seat?  The back seat was like a living room couch.

And the trunk...the trunk was as big as as some bedrooms...and yes, I enjoyed splaying a beauty on both the back seat and the trunk lid, flat big and at waist height.  Oh...the good 'ole days....omg...


Tue, 05/03/2011 - 12:02 | 1234253 Spastica Rex
Spastica Rex's picture

I find it hard to believe that was a five speed.

Tue, 05/03/2011 - 12:38 | 1234574 Don Birnam
Don Birnam's picture

The Seventies models all had 4-speeds as standard package, yes. The 5-speed was introduced in the early Eighties. The question remains, however: can one drive manual in plats ?

Tue, 05/03/2011 - 12:31 | 1234502 ebworthen
ebworthen's picture


I had a Chevette, 1981 five speed four door.

The body was solid (Fischer - remember that?) and the little four cylinder was a pretty good motor.  The execution was the problem. 

Plastic housing holding the clutch wire to firewall broke, not covered under warranty.

Exhaust Gas Recirculation tubes rusted through at 23,000 miles.  They admitted it was defective and gave me the part  but wanted to charge me $225 for the labor to swap it out (?). 

I went Japanese after I passed the Chevette on when I got tired of fixing it.


Tue, 05/03/2011 - 11:42 | 1234144 topcallingtroll
topcallingtroll's picture

Please always refer to them as government motors and never buy their products.

They bribed the big creditors with TARP, and screwed minority unsecured bondholders, upending a century of established bankruptcy law.

Tue, 05/03/2011 - 12:41 | 1234155 Cdad
Cdad's picture

I'm sure Phil "flaps up" Le Beau will be along shortly on the BlowHorn [CNBC] to explain the truth about GM "sales."  After all, that is his very job, to get to the truth about the auto industry, and he has been so busy this year explaining to the American people how bailed out GM is a national treasure.


SHOCKER!  Phil "flaps up" Le Beau passes on his intraday opportunity to straighten out the facts about GM.  His nonreporting reporting is followed up by a criminal syndicate Wall Street banker parade of bullish commentary on the BlowHorn's Strategy Session.  SHOCKER!

Additional Additional:  momo freak Joe Teranova makes the call long GM while calling the silver trade over.  Brilliant!  The propaganda machine is in full stride even as all the momentum stocks that have lifted this market to infinity bullishness are ALL breaking down.

Tue, 05/03/2011 - 11:56 | 1234213 ebworthen
ebworthen's picture



Hmmm..let's see...

  1. Rescinded senior bond and shareholder rights (theft).
  2. Stole money from the American taxpayer to bail out UAW and Corporate wonks at GM and banks (legerdemain).
  3. Forced dealerships to shut down and took them to court to not let them use their land to sell any other brand of car (skullduggery).
  4. Is forcing current dealerships to take delivery of inventory they don't want or can't sell it but then have to pay interest on the inventory each month (malfeasance).

"Baseball, hot dogs, apple pie, and Kleptoligarchy"

"Gawd Bless Amerika"

All hail Caesar!


Tue, 05/03/2011 - 12:16 | 1234412 Kickaha
Kickaha's picture

There is an obvious solution to this problem.

Chinese have too many dollars.

Chinese have brand-spanking new cities uninhabited with empty garages.

Chinese trade dollars for GM dealers' excess inventory and park them in empty garages.

You're Welcome!

Tue, 05/03/2011 - 12:31 | 1234529 topcallingtroll
topcallingtroll's picture

Ghost cities do need ghost vehicles!

Tue, 05/03/2011 - 12:18 | 1234429 rustymason
rustymason's picture

Anecdotally speaking, a few GM lots I've seen around SW Houston have been completely full of cars and trucks. 

Tue, 05/03/2011 - 12:50 | 1234615 DiamondEyes
DiamondEyes's picture

I think this guy has the right idea for helping GM move some of that excess inventory

Tue, 05/03/2011 - 14:43 | 1235222 Bagbalm
Bagbalm's picture

In a science fiction book Heinlein wrote he envisioned a future in which auto companies sent part of their production straight to the government in return for subsidies. He had them being scrapped and crushed before ever seeing the road. However given cash for clunkers and the loans he wasn't too far off.

Tue, 05/03/2011 - 16:19 | 1235630 Common_Cents22
Common_Cents22's picture

I sold my co to a fortune 200 a few yrs ago and they stuffed their channel all the time to make quarterly #'s except it is just a vicious cycle that erodes margins as, in their case, had to give incredible deals for distributors to load up on product.

I wonder what the inventory mix is for GovtMotors?  If gas prices continue to climb SUV sales will fall off the cliff along w/ profits.  Their might be a pickup in smaller higher mpg cars until the next wave of layoffs.

Wed, 05/04/2011 - 10:06 | 1237823 Sheriff Douchen...
Sheriff Douchenik from AZ's picture

Is it me or have many automotive journal shows like Motorweek completely fallen in line with the "everything GM is great" and then spend the rest of the time on green this and that? Who watches that? I stopped watching Motorweek because it felt like a giant General Electric Motors ad.

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