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Channel Stuffing The Economy: There Has Never Been More Cars "On The Sidelines"
Welcome to the new normal... The "if we build it (and offer credit to anyone who can fog a mirror), they will come" economy. While LeBeau and his cronies are cock-a-hoop over auto sales (no matter how those sales are achieved), it seems the carmakers are way ahead as the value of cars on the sidelines (inventories) has never, ever, been greater than now.
There has never been more cars in inventory than now...!
And unless this chart keeps soaring up and to the right... (leaving US consumers increasing debt-laden with just a wastuing asset as collateral)
and unless China picks up again real quick...
The global auto industry in recent years has been betting heavily on China’s west, where they see potential for faster growth than in the more affluent—and car-saturated—cities along the coast and in the country’s eastern and southern manufacturing belts.
Instead, the region has been hard hit by China’s economic slowdown, curbing auto sales and leaving residents like Chen Liang pinching pennies. On Wednesday, at an auto show in the sprawling western city of Chongqing, the 24-year-old junior manager for a laptop maker inspected a Chevrolet Aveo sedan, which sells for just under his budget of 100,000 yuan (US$16,120), once a 10,000 yuan discount is factored in.
The cost of living in Chongqing is comparable to Shanghai, Mr. Chen said in an interview. “But the salaries here are much lower.”
We are going to need a bigger parking lot... (from 2014)
Where the World's Unsold Cars Go To Die (courtesy of Vincent Lewis' Unsold Cars)
So there they sit, brand spanking new cars, all with a couple of miles on the clock that was consummate with them being driven to their car parks. Below is the latest May 2014 Google Maps image of unsold cars in Corby, Northamptonshire.
The longer they sit there the worse it slowly becomes for them. What is the answer to this? Well they need to be sold and that just isn't happening without more credit.
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How do I get the Ice Cream truck out?
Well the good news is that there should be a lot of fixed-up Texas flood damaged cars coming to a used car lot near you, too.
..and that runway/parking lot is a waste of a perfectly good rifle range.
Now don't get me going on golf course...
And just think of all those empty shopping malls...
"value of cars on the sidelines (inventories) has never, ever, been greater than now."
ditto for people
people on the sidelines
channel-stuffed people
hugs,
friends of fema
I live on a golf course and I have often envisioned an alternate use for the straight 545 yard Par 5 that I gaze at every day. Hell, it’s even got a raised hole with bunkers behind.
I don’t think my neighbors share my vision, though.
I have not thought of the mall re-purposing before. :-)
Standing with my attorney, looking out on a new golf course we had financed back in the 90s, I said: Oh well, someday this will make a nice community garden.
Rifle range and community garden..
You can’t get more American for repurposing land that was developed for a recreational sport fewer and fewer Americans can afford to participate in.
You might consider a local airstrip on a long diagonal to separate the functions.
It could also serve as a drag strip on weekends. :-)
It's all good.
They can paint them with 1-800-Joe-Plumber and send them off to ISIS.
ISIS loves them some hot Murican Metal....yeah!
Seriouly though, put these, in with the aircraft boneyards and gooodness knows where white goods (brand new) go to die, but this is the Supply side economy gone wild.
This is the supply sider's nightmare, NO ORGANIC DEMAND.....
...
https://www.youtube.com/watch?v=OsrCg7rwcqA
More and more forever and ever, never mind that in the developed world, population is going down as is real wages, but not to worry, the Keynesian models say it'll be shiny from now on......
KDX, know something strange?
Population growth is stagnent in India too. We are not even at replacement level, our birth rate is = USSA birth rate.
Add to that the fact that India's shiny new techonomy is tied at the hip to the fate of the dollar...
*stares down deep dark pit*
The only places with population growth are the most nihilistic regions since the best and brightest make sure they are fed and clothed along with plenty of weapons.....
MonSatan?
Vaccines?
Chemtrails?
+1 for cock-a-hoop, Tyler.
I was a big fan at one time except for the chafing part. Then came the restraining order and the charges - I'm really not suppose to talk about it.
But the looks on the faces of bystanders was priceless!
That runway is just asking for a few monster trucks to drive over top of all those cars...
Yeah, but think of all the action movies they could make!
Might not have worked out so well for this guy:
'Texas Man, Dog Found Dead Inside Corvette After Doors Apparently Fail to Unlock'"A Texas man and his dog died after they apparently became trapped inside the man’s car because the doors wouldn’t unlock, according to a Houston-area television station.
Officials with the Port Arthur Police Department told KBMT that 72-year-old James Rogers was found unresponsive inside his vehicle with his dog, Leia, the station reported on Tuesday.
The door locks in his 2007 Chevy Corvette are completely electric, and officers said it appeared the battery cable came loose while the pair was inside the car. With no power, the doors would not unlock."
http://ktla.com/2015/06/11/elderly-man-dog-die-because-car-doors-wouldnt...
Obama-cars!
Lots of stock for the next big disaster movie along with Chinese ghost cities.
Better yet
Turn them into self driving cars and let em loose!
I guess eventually they will have to have some serous sales to simply move the "metal", that is when I will strike.
move into a chinese ghost city and get a free car! 2 birds with one stone
Good Lord. If Hillary promised a new car for every vote, she would win in a landslide.
dont give her any ideas
Its called "collateral" for the big banks to support their derivative house of cards.
Priced to fantasy collateral underpins the world of finance.
priced to reality it all comes down
Moving those vehicles would require somebody to take 30-50% write offs somewhere
Its easier to store them at "full value" on the books than risk reality
Central planning of economies is so productive, just look at all those valuable items.
Can't sell them at these insane prices and falling income. Can't give them away as that would fuck up future sales.
you mean the wealthy (top 1%) dont buy hondas and fords? SHOCKER!
get ready for the next auto bailout. after the next banker bailout and then the subprime bailout. which, of course, is super great because then yellen can fuck the peasants even more by printing moar.
Why worry?? With the EPA's new airplane emission regulations soon to come, we'll have PLENTY of space for them.
Massive Keynesian Clusterfuck
I wanted to get a new car, but I didnt want to pay $40k for it.
Well... let it rot on a graveyard instead then, I'll let my $1k ride roll for another 100.000km
Do your patriotic duty and borrow money for a new car. Maybe you can collateralize using your body pledged to the Soylent Corporation.
Long flatbed trucks and repossession services.
I doubt it. Like home foreclosure they will just let you keep and squat rather than take the expense of possession, especially when there are no buyers. The best plan is niche online auction business where you can be the liquidator subcontractor for the lenders. A good friend has done that with machinery and made a good business from it as well as a hedge against a decline in new equipment sales. It seems that regardless of the economy there are always buyers and sellers, just got to find the right market. Auction business is good because you don't have to own what you are selling. Simple commission.
Flow over stock - this whole thing is so absurd they may in fact repossess so that they can "sprice you up" and sell you another one on a 7 or 10 year payment plan a year later.
That being said, I understand your point and though my statement was and is geniune it also included a tad of sarcasm. Interesting idea with the auction which also contributes to helping Flow.
Actually, it will be debtors prisons.
Yeah, not "legal," but then that is the power of having your fellow Amongst control the courts.
Liberty is a demand. Tyranny is submission..
Have Costco handle all sales and then federally mandate the 2 year return for any reason for a full refund, problem fixed.
...and this is with 'Just In Time' manufacture....
That is crazy.
all those unsold cars, explain again why car prices are so high? You know, supply and demand and all
"You know, supply and demand and all"
you must be reading your econmics books that are based on a capitalist system. i think we all know capitalism (in the West) was killed in 2008/09 by Ben.
rather instead,
economics books that present endless fuzzy extrapolations
derived from a mathematical model with unrealistic assumptions,
the very model which underpins the imagined "free-market capitalist" system
that many wistfully
believe once existed and/or wishfully believe some day could.
Myself, I can't take for fact that the pics are recent, or have anything to do with channel stuffing, or that they are actually cars.
Please see Chart #1.
Those pics aren't recent. They've been on ZH already over 10 times it seems. But what is real is what I see what my own eyes. Hidden lots away from dealerships loaded with brand new cars. And I'm talking BMW. Lexus. Land Rover.
+1
These photos get trotted out every time auto stuffing comes up.
Iv'e seen these photos quite a bit lately.
http://www.snopes.com/photos/automobiles/unsoldcars.asp
Look around airports. Parking lots A, B, and C might be fine but why is D full of new cars, all of the same model?
cock-a-hoop?
+1 for Cock-a-Hoop. ": very excited and happy about something done"
They should run a BOGO. I would actually think about buying. Atleast they get paid for one and move another. Might be a great idea !
Not sure how much it means locally, but the dealers around me are sitting on a LOT more new inventory than normal. These are not sold units, I know these dealers and where the sold units sit in another spot. This also dovetails with all the radio spots I hear about "having a GREAT selection of new trucks!" etc. when I hear the salesmen blathering on the radio about how it's never been a better time to buy a new car.
I think the farming induced buying has begun to dry up. I know it for fact at most of the implement dealers.
Don't store them, crush them and grind them into bits. Then give taxpayer money to the dealerships to help keep the "sales" figures up.
CFSNCI - Cash For Stale New Car Inventory, bitchez.
This comment is Paul Krugman approved.
Dealerships will have to entice higher rebates or declare Jewish lighting inventory losses.
"Automobile manufacturers can, at any time, access their computers' databases and instantly know how many vehicles there are "on the ground" (sitting for sale on the dealerships' lots) across the nation. If there are too many vehicles of a particular model in a particular region, the manufacturer may offer a rebate to consumers as an incentive to buy those cars and get them off the dealerships' lots. Because the inventory of vehicles varies from region to region and month to month, rebates can also vary from region to region and month to month."
Just like the banks buying up houses and keeping them off the market. If the auto makers were forced to sell all these, for about 5 years you could get a brand new car for 5000, I would guess. Deflation is a sin you know.
Cash for Clunker battery operated obsolescence renewal program.
The other day my dad said that he had "never seen so many cars on the lots" near his home and around in his travels. I just laughed, by which he knew that there was a story, and not a good one, behind it.
When the dollar goes tits up, those cars will be repossessed by Zion's banksters and shipped overseas--Haifa?
Liberty is a demand. Tyranny is submission..
Massive economic denial. Ponzi through and through. Truthful economic measurements like "sales" do not exist anymore. Sales are measured when GM or Ford sell the car to the dealer, not when the dealer sells it to me. That exists only to game the numbers because .gov can't control consumer spending, but can control dealership stuffing "sales".
These pictures are hilarious and if any images exist to show the realistic state of the economy, these are the ones. Overpaid union assembly shops combined with absent consumer purchases equals US economic growth. LMFAO!
"was consummate with them being driven to their car parks "
LOL - a quick f*** between factory gate and the lot?
I would be more impressed if the pictures were from May 2015 instead of last year. Ho Hum.
Let's see the updated pictures of the same spots, then we can talk
I would be impressed if people understood
that the chart showing car inventory is up
means cars must be parked somewhere
without having to be illogically convinced either way
by some pictures of car lots.
I wish I knew where the pictures were taken...I could go steal a car and they wouldnt even miss it.
Same story with BMW, whose stock price is propped up by their claims of record China sales
http://www.wiwo.de/unternehmen/auto/streit-um-verkaufsvorgaben-bmw-zahlt...
I occasionally do contract work at the BMW factory in SC, they've had lots full of spare cars for a few years now.
Until easy credit goes away to slow the demand, they can still sell them at their normal prices...
Do the ISIS dudes have good credit?
Nope. But that still hasn't stopped them from obtaining an impressive selection of 'Murican military trucks, off-road vehicles, tanks and weapons systems.
There’s got to be an upside to this for the auto industry, for instance, they won’t be paying out injury claims for all the defective components that found their way into the public’s use. And replacing faulty airbags, ignition switches, etc., can be done on multiple vehicles at a time.
After nearly 7 years of hopium, I’m becoming convinced there’s gotta be a pony in here somewhere.
"After nearly 7 years of hopium, I’m becoming convinced there’s gotta be a pony in here somewhere."
That pony will turn out to be a bucking bronko.
Princess Sparkle Pony is in the white house. He gets rode regularly by Reggie
So... "Good time to buy"
But wait till the month end, when they're more motivated and they gotta hit the monthly targets. A shame that the "bargain" you haggled for, only screws the salesman* and NEVER the Dealer (Finance guys behind the desk on their PC's, and the Owners), who shares only the Front End, and the Rear End of any Margins.
the cars themselves never get marked down, it's always just tricks with interest rate buydowns. How about 70% off ?
Sell them to Isis they seem to have good credit.
Its kinda hard to compete agianst corps that dont need to make an actual profit. Screw up like that in a normal business and u r toast.
Guess what the plan to fix this is. Thats right outlaw paid off cars. Prof dine and dash Krugman understands it so well. As a side just think of all the DMV fees they will generate. Besides China needs the scrap for the war effort.
Maybe give them to the NowannaPay generations that do not want to pay their student loans and assorted other debts.
Free Obama-loans,,, Free Obama-Care,,, Free Obama-Phones,,, Free Obama-Homes and now Free Obama-Cars.
Can't beat that with a stick!
"Free Obama-loans,,, Free Obama-Care,,, Free Obama-Phones,,, Free Obama-Homes and now Free Obama-Cars."
What reality are you living in? In the version of reality that I live in, adult males between 18 and 67 qualify for about $160 a month in food stamps, and that's it. No free housing, no free phones, no free cars, no nothing, and the jobs are paying less and less over time because they can, because jobs are so scarce and people are desperate.
The working class has been ground into oblivion, working harder and harder for less and less, so fucking be happy already! Your side won! Congratulations!
Now would you please be so kind as to let go of those ancient Reagan-era wheezes about "welfare mothers driving Cadillacs," because they're getting extremely annoying, and if you keep poking the slaves with a stick you just may end up biting off more than you can chew...
You just don't know how to work the system. And in addition you can get cable TV for about $12.00 a month. How do you think 92 million americans ain't working but they are still eating? Haven't seen a lot of bodies laying in the streets.
"How do you think 92 million americans ain't working but they are still eating? Haven't seen a lot of bodies laying in the streets."
No, all I see are legions of homeless people everywhere I look. Homeless people sitting under freeway overpasses, holding signs on the side of the road saying "Anything helps, God Bless" and "Please Help." Homeless people at literally every single major intersection in my city, holding cardboard signs, looking destitute and desperate. Yep, there must be TONS of benefits they're enjoying, which is why they look like they haven't had a bath in weeks, why the skin lesions on their faces look so robust and well kept, and the rotting crumbling clothing they're wearing looks ever so stylish; which goes ever so well with the looks of misery and hopelessness on their faces, because they're just ROLLING in free benefits!
Meanwhile, corporate oligarchs are swilling down metric gigatons of 0% free money, which they use to bid up the price of things the rest of us need to survive, while their lackeys line up to piss on the impovershed and comfort the comfortable. Nice. Oh yeah, I'm sure this is going to turn out real well...
$160/mth is higher than my current grocery bill -- kinda shocking that food-stampers should be eating better than some of us working stiffs.
At the local Costco, there's a pop-up tent outside advertising free Saf-T-Phones that include 200 min/text/data. Stopped by to take a look and you have to be on EBT benefits to qualify -- so there's your free Obamaphone. Out of curiousity, I checked out the Saf-T-Phone website and the support forum is full of questions about how to bypass the phone's built-in restrictions and use it to surf the net or install games. If these people spent as much time and effort working, they wouldn't need the benefits.
As soon as they are bought, they depreciate. The entire Blue book thing has always killed me.
As soon as they are bought, they depreciate. The entire Blue book thing has always killed me.
Can we get more recent pictures. Early 2015 maybe? Might help to compare.
"There has never been more cars in inventory than now...!"
The chart looks like an inventory bubble. But don't worry, Yellen won't be able to see it until it bursts.
Unless you're trying to buy a new Subaru outback 3.6R....
Count your blessings that you can't find one right now. They're overpriced unreliable gas-hogging vehicles for the pretend-outdoorsy-hipster crowd. I owned one for all of 8 months before finding a greater fool to take over the payments.
I really like the picture of the Chrysler Aspens, a vehicle whose production ended at the 2009 model year.
Dodge Durangos...one can tell by the rounded tail lights.
We are going to need those cars for the masses of over educated Uber drivers.
We are going to need those cars for the masses of over educated Uber drivers.
We are going to need those cars for the masses of over educated Uber drivers.
You are printing comments like the FED prints USDs. I still like what you said anyway. :)
Don't know how recent the pics are but I know the Toyota dealer near my place has rented a whole other lot just to store cars
What I want to know is, why aren't the Keynesians out there breaking some windows?
Tyler, where did you get the data? Is this suposed to represent global inventories? I ask because North American production is down year over year for Ford and GM, and slightly up for FCA. For the industry as a whole, NA production is less than +2.9% higher than 2014, with a sales forecast of +5.8% over last year. Also, US dealer inventories were down year over year as of April. Doesn't add up to the first graph in the post.
Jalopnik had a response to the car park pics back in may 18 2014