GM Auto Sales Crash, Dealer Inventory Near All Time High

Tyler Durden's picture

It was expected to be a bad quarter for General Motors. It ended up being abysmal.

GM reported that July auto sales crashed by a whopping 15%, nearly double Wall Street's already depressed expectations of a 8% drop, and with GM mothballing production across the country to catch up with lagging demand, it still sold only 226,107 vehicles as a result of double digits drops in Chevy, Build and Cadillac Sales of 15.3%, -30.5% and -21.7%, respectively. The only "good" performer was GMC, which dropped by "only" 7.3% Y/Y.

The company also reported that while the average transaction price was $36,000, or roughly $1,000 higher than a year ago, the incentive spending as a percentage of average transaction prices was 11.5%, near an all time high.

This is how the company explained this dramatic decline in production:

“We have strategically decided to reduce car production rather than increase incentive spending or dump vehicles into daily rental fleets, like some of our competitors,” Kurt McNeil, U.S. vice president of Sales Operations, says in a statement.

Which would be great, however judging by the almost negligible drop in dealer inventory, which saw the number of cars parked at dealer lots decline by just 40K to 939,831, resulting in a near record 104 days of sales, it appears that GM needs to shutter production for months on end to normalize GM's unprecedented channel stuffing.

Abysmal sales aside, however, the company remains quite optimistic: "Under the current economic conditions, we anticipate the second half of 2017 will be much stronger than the first half," Mustafa Mohatarem, GM chief economist says. Good luck with that anticipation chief GM economist.

And speaking of GM's "competitors", it wasn't any better there, with Chrysler reporting a July auto sales drop of -10.5%, also far below the 6.1% expected.

  • Fiat brand -18%
  • Chrysler brand -30%
  • Jeep brand -12%
  • Dodge brand -12%
  • Ram brand sales were flat y/y
  • Fleet sales -35%

And some other car makers:

  • Ford down -7.4%, Exp. down -5.5%
  • Volkswagen down -5.8%
  • Honda down -1.2%
  • Mazda down -3%

At this rate, the US auto sector could become the catalyst that finally tips the US economy over into recession.

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NugginFuts's picture

Bullish!!! Good for another 10% boost to the markets! All hail failure, the new success!

Déjà view's picture

FED airbag...pedal to metal...

robertsgt40's picture

At least there's still a market for Toyota pickup trucks. ISIS 

NoDecaf's picture

It looks like ZH finally has a mod cleaning up the 7k spam, I just noticed a few posts disappear. Good, hopefully he can go after the shep scammer and his 30 accounts.

John Law Lives's picture

I want the dailywesterner spammer banished (assuming it is a different person).

TheDude1224's picture

Oprah says, "You get a GM car, you get a GM car, you get a GM car, everyone gets a GM car!" 

Bam problem solved. Let production continue!

El Oregonian's picture

Serves them right, Government Motors, sellouts under Obozo. I'll never again purchase a vehicle from this company... Ever.

rcintc's picture

Chapter 22....Here we come

Looney's picture


Why worry about GM?

When they go bankrupt, and go they will, Trump will bail them out, just like 0bama did.

Fuck Trump and Crooked Hillary he rode in on!  ;-)


TBT or not TBT's picture

I thought Trump had said the GM bailout shouldn't have happened.  Bankruptcy/breakup heould have.   I thought he'd said.  

Straw Dog's picture

FED nosebag to feed the iron horses.

JRobby's picture

But how are all of the "other" car manufacturers doing as a comparison????

StychoKiller's picture

I'm STILL driving my 1990 Dodge Dakota 4X4 pickup (less than 100,000 mi).  Why on Earth should I shell out enough Munny to buy a small house, for a new vehicle?

yogibear's picture

At least another 10%. Getting more awesome with more negative news.

Donald J. Trump's picture

Believe it or not, I need a car and tried my luck last week at several dealers for different cars.  No one wants to sell me a car. 

itstippy's picture

The article says average sale price of $36K.  Did you offer them $36K?

FreeShitter's picture

Niggas are broke these days. Plain and simple.

Déjà view's picture

Fog a mirror Chevy driving illegals...hiding...

yogibear's picture

Cash for clunkers, this time $8,000?

New super QE of $200 billion/ month

Utopia Planitia's picture

Why not just put GM under the Dept. of Transportation and mail each welfare check recipient a new vehicle each month? Problem solved!  (oh wait, somebody's got to pay for this...  how about we send that bill to The Bern and Nancy "facelift of the month" Pelosi?)

charlewar's picture

relax, fraudster elon musk turning up suction on his vacuum cleaner called Tesla to suck more money from his suckers...oops, investors.

GUS100CORRINA's picture

GM Auto Sales Crash, Dealer Inventory Near All Time High

It was expected to be a bad quarter for General Motors. It ended up being abysmal.

My response: President TRUMP must have gotten some advianced warning on the GM news which might explain the following:

Trump Tweets Dow 22,000 Today: Embraces Big, Fat, Ugly Bubble


Countrybunkererd's picture

Posted on the 22K tweet and seems good for this one too.

Where is the money coming from?  My case for (fill in the blank):

A two income family each making $20 dollars per hour.  That is 83,000 dollars a year.  I will use 85,000 for simplicity.

Take out:

Federal Taxes:  (15 & 18 percent bracket- will only use 15%)  = (15,000 dollars)

SS & Medicare (15.3 % will use 7%/ employer pays half) = (7,000 dollars)

State & Local Taxes (Not standard and will use 5%) = (5,000 dollars)

Home +RE TAXES or Rent (highly variable will low ball at 1.5K/mo) = (18,000 dollars)

2 Cars (assuming that everyone "Needs" their new shiny car to impress neighbors so they lease them at 300/mo each) = (7,200 dollars)

Health Insurance (self employed rates for this one and variable will use 1200/mo) = (14,400 dollars)

Gas (again variable will use 2 tanks per week at roughly 400/mo) = (4,800 dollars)

Food (150 dollars per week) = (7,200 dollars)

Electricity, AC, Heat, Water, (300 dollars/mo) = (3,600 dollars)

Phones and connections (300/mo) = (3,600 dollars)

EXPENSES: 85,800 Dollars

The Median Household US income in 2015 was roughly 60K

Who can dump 5-6K each into their 401K or IRA?  I understand these numbers are highly variable depending on lifestyle and location.  But the money just isn't there.  PERIOD.  Add clothes, children, etc. and what then?


Devils Advocate's picture

Forgot Car Insurance $2000 a year!!

Uchtdorf's picture

That's a good exercise and an excellent dose of reality, but I think you based your Federal pillaging on an income of $100,000, not the $85k in your example. Thus,

Taxes = $12,750 and

SS = $5,950

Still, the end result is poverty. Poverty while pretending to be rich.


Federal Taxes:  (15 & 18 percent bracket- will only use 15%)  = (15,000 dollars)

SS & Medicare (15.3 % will use 7%/ employer pays half) = (7,000 dollars)

Countrybunkererd's picture

You are correct.  I started with 100K.  or 25 dollars per hour each (104K technically).  THANKS!  In .gov terms that is a net gain of 3300 dollars!  Vacation?

Uchtdorf's picture

A smart man would spend it on home protection instead of a vacation.

TBT or not TBT's picture

A smart man already has that covered before even getting a home.  

The_Juggernaut's picture

Your tax estimate also needs be adjusted for deductions and exemptions.



with the standard deduction and personal exemptions, the tax would be $8817.50.  Look at that!  You just freed up about $6,000 that you can invest in a jetski like a good American.

Countrybunkererd's picture

Awesome!!!  A song comes to mind.  Something about always look on the bright side of life...or something like that.  I think i will go for the $70,000 loaded pick-up truck, get it lifted and repainted.  I heard I can get 0% over 8 years! Check THIS out neighbors!!  "ME's DOIN' GOOD!"

blown income's picture

That's just about every oil worker here!

Seasmoke's picture

Dont spend that $3300 in "savings" you just found all in one place....LOL

SubjectivObject's picture

credit card payments!

what is that per capita consumer debt ...

XBroker1's picture

You can't add clothes and expect to end up w/ children. Pick one.

Countrybunkererd's picture

Children, because the scenario proves one can't afford birth control.  Not to mention you would be naked because you can't buy clothes either.

Uchtdorf's picture

You gotta get a job as a stand up comedian.

GunnerySgtHartman's picture

Children, because the scenario proves one can't afford birth control.

Get it for free at the local health department - assuming one's ego will allow them to do that (amazing how that's the ONE thing the Free Shit Army won't do!).

Pigeon's picture

That's because  babies=bigger welfare payments. Stipends per head. Again, why they gonna use BC?

j0nx's picture

Agreed. $100k a year aint shit these days when healthcare costs are what they are. I have excellent work provided insurance and my HC costs are still running about $9k a year after monthly premiums, deductibles and copays. $750 a month is a shit ton of money for healthcare and we have it good compared to most. Factor in the cost of real estate in the DC area in non illegal alien infested areas with good schools and it is simply unsustainable unless you make minimum $100k a year.

valjoux7750's picture

I'm making it fine on 50k,my car insurance for two cars is 1200.00 a year and my health insurance for four cost about 800.00 a year. My rent and utilities around 900.00. I would love to make 100k.

Company paid BCBS by the way. Living in the peach state.

Seasmoke's picture

and you are WAY WAY LOW on Home and RE costs (atleast in NJ !!!!!)

vega74's picture

Here's some more third grade math specific to GM.

In 2005 I bought a Chevy Silverado work truck for $18,000.

According to the cpi calculator (take that with a pound of salt) the inflation adjusted cost of that truck today

would be $23,121.

And the MSRP sticker for that '17 truck?  $33,620

* shocking * that car sales trajectories are dropping like a rock/sarc

Pigeon's picture



post turtle saver's picture

pickup trucks cost way too much... even with the incentives they cost more than they're worth...

this is what we get with idiots buying 'luxury pickups'... 

TBT or not TBT's picture

A lot of added cost comes from EPA type pressures on design.    And other Govt mandates.   

aliens is here's picture

That's where 2nd jobs comes in.

Sky flyer's picture

Add in even a few small medical problems or, god forbid, a minor surgery or two and the credit card debt will add up quick to make ends meet.

matinee55's picture

You have been censored - @cnn @msnbc @abc @cbs @cnbc @nytimes @npr @ap @nbc @huffpost @ft @time @usatoday @washingtonpost @politico @slate @vox

Caveman93's picture

A GM in every poT!