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US Automakers Worst Nightmare: Chinese Auto Inventories Explode In May
A week ago we exposed the massive number of cars piling up in GM's parking lots in China. A few days later, we note that Chinese auto sales have collapsed at the fastest rate in 3 years and an increasing number of new orders are being cancelled as the stock market crashes. But the triple whammy for US auto manufacturers - who have incessantly pitched China as their growth engine - is news from Huaxia Times that China's import car dealers saw inventory days reach a mind-blowing 143 days in May. For context, the normal average has been 24-36 days. Once again it appears the serial extrapolators at the automakers, excited by the serial extrapolators at the big banks have excitedly mal-invested right at the turn.
Car Sales tumbling...as The Wall Street Journal reports,
China sold 1.51 million passenger vehicles last month, down 3.4% from a year earlier, the China Association of Automobile Manufacturers said Friday. That compares with a 1.2% year-over-year rise recorded in May and a 3.7% increase in April.
The performance was the worst since February 2013 when car sales fell 8.3% on-year during the weeklong Lunar New Year Holiday when car showrooms are closed. Stripping out the holiday factor, the last time China’s car market posted a decline was in September 2012, when a territorial dispute between Beijing and Tokyo over a group of uninhabited islands in the East China Sea hit demand for Japanese cars.
... also cut its growth forecast for China’s automobile market in 2015 to 3% from the previous 7%.
“2015 will be an off-year for the Chinese car market,” said Dong Yang, a vice president for the auto manufacturers’ association. He said the slowdown was caused by a confluence of factors including the cooling economy, increasing restrictions on car ownership to combat congestion and pollution and stock market volatility.
“Neither a bull market nor bear market does good to car sales. Our surveys of dealers show that visiting volumes to car showrooms dropped sharply in the first-half,” said Mr. Dong.
...
“The painful market adjustment currently under way is far from over,” he said.
* * *
Auto Inventories exploding...
Huaxia Times: China's import car dealers saw inventory days reach 143 days in May vs. normal average at 24-36 days.
— Patrick Chovanec (@prchovanec) July 13, 2015
But, as we previously noted, it appears there just is no more room to stuff inventories in its Shenyang, Lianing province parking lots (as China has become the new car graveyard over the last 3 years)
But it's not just China... inventories are surging in America too...
Judging by the massive volume of cars 'parked' in GM's Shenyang Liaoning lots, it is clear that automakers learned nothing from the last "if we build it, they will come" channel-stuffing inventory surging dysphoria that, among other things, led to their last bankruptcy... if only Chinese buyers would take up the credit terms like Americans.
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There's a Pontiac in the third to last picture. Pontiac has been dead for five years...
Bicycles are a lot cheaper.
I've worked for the Big 3. Believe me... their mindset is like politicians. They never think long-term when it comes to budgeting or building. It's always now now now... push push push... grow grow grow (especially GM). Such irresponsible management is always doomed to failure when reality sets in.
But, not to worry... big-brother-bailout government will come to the rescue again - as they do with the banks - thus rewarding reckless behavior at the taxpayers' expense.
The Car Nazi says; "No Volt for you"
Illustrated once again with pictures 5 and more years old.
This is fantastic news for the $300 million expansion by Aleris in Lewisport, KY to expand production of aluminum automotive body sheet...
"Believe me... their mindset is like politicians. They never think long-term when it comes to budgeting or building."
An executive in a big firm listed on a stock exchange has the same motives as any "slither," pol or crat, does. Short term manipulation and lies to push up their stock valuations, then cash out and slither away. Then also, no consequences if the whole shit show collapses after they depart for villas and tennis in the sun.
But then it's all luxury and leisure until the guillotines catch up with them.
Liberty is a demand. Tyranny is submission..
The more bankster heads in baskets, the more prosperous the future will be.
. . . and you can fix them.
Exactly, you can fix them yourself for a lot less. Plus you dont need to pay insurance and you can get one with a battery pack for assist.
You'll look like a drowned rat for your McDonald's interview.
This is not just the US.
Just out of shot are the Mercedes/VW/Audi fields of cars and slightly further away (in a posher area of course) are the RR and Bentley lots who are really getting hammered.
Germany is going to suffer like the US in this one.
The very high-end & exotic makes had a record year in 2014. However, that may have changed.
That first picture of white and black roofed cars is a coded message: "The End Is Near!"
... they're still selling Pontiacs there because ... Poor Old Ning Thinks It's A Cadillac ...
I image searched that pic. It's a stock photo provided by GM themselves, and it dates back to at least 2009.
Good catch. Obviously an error if not outright disinformation in supplying these pictures.
At least it was not a Nash or a Packard.
Its about the chart not the pics, but yea expect more
Oh and lol, nash
and it's an oddpickle illusion. the middle car (Pontiac) looks like it's parked smack in between the other two cars.
it just creeps me out.
Yeah, what's with the pontiac? And those are old Malibus. That's an old photo.
Not to worry.
You are disturbing the story with those revelations.
Any car not sold in 5 years needs to be crushed.
But ................. bicycle sales are soaring!
Peddle yourself as Fred Flintstone.
Gonna need a bigger 'cash-for-clunkers' program.
All the clunkers are gone. More like 'cash for semi used cars'.
"Cash for perfectly OK Used Cars/trucks."
Do Sum Ting will probably require state-owned China Post to buy these GM cars in turn for a few thousand acres of fine RE in Cali or Seattle areas on the sly, of course.
So when do the Chinese get to use stocks at 400% markup as collateral for an auto loan?
You're trying to tell me GM is still manufacturing Pontiac G6's?
Nigger, please.
"Attention, Niggaz, More EBT cards are being passed out in aisle 5!"
GM will announce they are now accepting EBT cards.
good eye
http://car-pictures.cars.com/images/?IMG=CAC00POC121A0101.png&WIDTH=624&...
apropos of little - I can't believe they aren't making GTOs anymore.
the new chargers are real cool, the mustangs are kinda cool... what is needed is an updated version of the '69 GTO.
~That~ ---- is a Goat...? Please say 'taint so... And if it is, they shoulda dropped the line yesterday...
When I was a kid, the airline pilot father of the wildest kid in my uptight suburban neighborhood had a '69 GTO. He would frequently goose it and peel out, even smoking the tires when running mundane errands like going to the grocery store. We thought he was pretty much the coolest grownup we'd ever met.
Now its tweakers doin' the burnouts.
Make mine a 67 and no rag top please
English - E before R except after GG, then drop the "ER" and add "A".
Cut in at :04 for Aunt Esther.
WHAT DID YOU SAY, NIGGA?! 1974https://www.youtube.com/watch?v=RQhiZpLJtcg
yeah man - I feel like its 2 different words.
I'd never say nigger, especially 'to' someone.
But I say "niggA" all the time now.
Any black dudes here? Can I get a ruling?
I knew a guy who had one of those, and he raved about it. It was actually a damn good car (price/performance), right?
Mine was faster than a scared haint. Just full stock and auto. Would run and actually held the road pretty well.
With gasoline at about $0.25 a gal for real high octane, mileage numbers were not too big of a concern.
I used to travel for business quite a bit and usually got stuck with GM rental cars. They are all the same car with different names. The Pontiac G6 was the Chevy Malibu was the Buick Century was the Oldsmobile Alero. Such garbage. I always put them to the test, which they usually failed miserably. I'd give myself a high-five if I could get the "check engine" light to come on, which wasn't too hard.
My company paid for the rental insurance, too :)
This rental car's gonna have more air underneath it than a skateboard at the X-Games.
More than a decade ago I read that it costs the auto manufacturers around $300 million to bring out a new model, including the costs of design, retooling, training & marketing. So no wonder they just rebadged the things and made as few superficial changes as possible to maximise profit. No wonder they went bankrupt selling the same shit while others around the world invested heavily in R&D.
Don't laugh, but I'm really looking forward to the world's first mass produced hydrogen (fuel cell) powered car after all these years of anticipation. It's the Toyota Mirai and I really think it's a game changer as long as they don't source critical components made in the US (Like the brakes or steering). It might even drive Tesla out of business (Earlier than it would have gone out by itself).
Stawks are soaring, this is great news!
No?
The planetary Financial Empire just exploded.
"It was, Wan Kenobe, like a trillion shares screamed out in pain."
Contract negotiations just kicked-off today with the UAW and Barra.
Just yesterday the TV commentators were saying, “It doesn’t get any better than this for The Detroit Three.” Even though one of the three is Foreign now.
I think that will cover the State of Michigan...but that's probably about it.
btw...is that an export terminal?
It's not like China doesn't make their own cars.
Folks love their Hondas in the USA. "Made in Ohio."
Same goes for Toyotas, Hyundais, Nissans, Kia's...did I miss any?
China just bought the Volvo Brand and will start making those in the USA...plus BMW, Mercedes.
Oh, Mazda and Suzuki...forgot about hose two.
Big Three you say?
Sounds more like Big Thirty now...
Building cars that no one will buy under climate change emission mandates. This government doesn't understand the consumer. Fuck off Obama, stick your dick in the tailpipe and pretend it's Reggie.
The governmemt will buy it. Remember the K cars. Now we have the ford explorer to replace the crown vic for all the police agencies.
It's pretty hard to get the average consumer to buy a new car every six months isn't it.......
In Beijing, the polution is so bad that you can only drive your car on certain days depending on your license plate number. The solution is to buy two cars. (not lying).
they get a pass on pollution control on everything and we get al gore bullshit.
I suspect there is a plan in effect...not funny
correction i know it
Product obsolescence is a real bitch for the fractional reserve steering committee forecasting human beings consumption habits. /lol
Wealth defect.
I guess this means Buick is fucked. There's not enough blue hairs in the US with cash to pick up the slack...
"I guess this means Buick is fucked."
Yes, this was the last straw for Buick. /s
FYI: Buick was GM's best seller in China for years. I'm not sure if that anomaly is still the case, however...
Yep the Chinaman just beat you again. Think of how many ounces of Platinum will be scrapped from all those catalytic converters, now in their hands free of charge. hehe
And you thought we were going to buy the cars. BWAHHHHAHHHHA
But why?
Make a reef or Military Island out of the cars.
Simple, just do 5 for one sales and make it up in volume. 120 month financing.
Gubmint motors doesn't give a shit the serf taxpayers will just bail them out again!
Fuck it, they could give them away and not fail!
FUBAR!
Just in time supply chain plugged up like over-filled toilet.
But the Chinese market will save us all - Wall street says so.
Who in their right mind would buy a new GM product?
Same kind of person that would buy a Ford or Chrysler
The ones that don't qualifier for a Honda Toyota.
When its zero down why not..
Make you happy for a while
Look over here - another almost Greek deal - no do not look in the far east.
And the sheeple all looked the way the banks wanted. Almost biblical.
As was pointed out here: http://www.zerohedge.com/news/2015-07-07/why-gm-back-below-its-ipo-price... these photos are not recent.
Zerohedge reporting has now officially reached the joke level.
Detroit's solution is always find more storage lots.
Free car w/every Student Loan!
Free debtslave AND car with every mortgage.
Just wait for the NINJA car loans with $10,000 CASH BACK! (non-dischargeable, per the mice type)
Maybe they'll put governors on them and let us play bumper cars at FEMA camp.
Yay! fun camp!
dont give them any ideas, cash for clunkers was hard to watch from an economics standpoint
And this is during a time when: no interest....500 years to pay...you dont need an income....and we will give you 5k for your pinto with 240,000 miles on it. And if you cant make the payments, just trade it in for another new car. Just sign here.....ya dont speak english? thats ok, we have a translator. :-)
GM will offer a couple of 100 yr US Bonds if you sign and drive it away.
Better yet. GM can mask KIA marketing skills to unload bloated union channel stuffing inventory.
Orlando Kia's BOGO- Buy One, Get One - YouTube
Has anyone here driven one of those Chinese cars? I bought a non-running scooter for dirt cheap off a college kid and I know it is a bitch to find parts but since I paid so little and finally found where to get the parts the thing runs great now. It's a 2008 Baotian and the young chicks dig it. Sitting next to my Harley's it looks pretty silly to me but it's a chick magnet for sure. I don't need anymore "chicks" unless they have cash and want to buy it. I looks really good and it sure does not burn up much gas.
I would be a little afraid of the Chinese cars because parts seem to be an issue for their equipment. I have seen a few Chinese scooters around but not a Chinese car. They seem to have an issue with part numbers and they do not speak so much English. I was told "We need picture or no part.". I even have a service manual for that scooter and it has schematics but no part numbers. WTF?LOL
The used shitmobile market is where it is at anyway thanks to Cash For CrackHeads. Well, at least to some degree. Who can afford a new car these days? Holy shit!!! I buy 'em and sell 'em so I have seen some bullshit and I don't always win. I had a 2005 Hyundai Accent with 103K on it snap a timing belt while running down I-94 on July 3rd. Oops. That is a fucking huge problem. That is an interference type engine so I think I lost some cash on that that one but we are tearing it apart anyway. That one cost me 3K to buy and now I might need to replace the engine. No profit at all there.
There is an important lesson to be learned from that situation and it is this: How often do you change your timing belt? Well, I'm not real big on doing that either because it is not cheap to pay someone to do the job or is easy to do the job yourself. Most of you have that same style of interference engine and you can learn about that by doing a google search or making a phone call. I don't think this is a major wrench site but it is an economics site. I learned the hard way so far about getting after the timing belt but in my defense I had not owned the car for very long. Check out your service records and your owner's manual if you actually have one. No one tries to upsell you on a timing belt so yours is most likely what came with the car.
You have been forewarned. If you are over 100K and have never heard of a timing belt then you might want to consider your options.
On a long enough timeline, the failure rate of all vehicles goes to 100%.