Dealers facing tight supply of SUVs, trucks

[RamboLiberal]

Source: Dallas Morning News

If you've got your eye on a new SUV, don't blink.

It might be gone. Even with the auto industry mired in depression – sales are down nationally 36.5 percent – big vehicles such as the Ford Expedition and Chevy Tahoe are in tight supply because of drastic production cuts that automakers imposed last year as sales began to plummet.

Now, a year after $4-a-gallon gas nearly killed SUVs, some dealers in this market are selling them for window-sticker prices. Moreover, most late-model used pickups and SUVs have regained all of the thousands of dollars in trade-in value they lost last summer, dealers say.

Dealers love for demand to exceed supply, but many are concerned that they could run short of profitable trucks if the economy improves in the second half of the year. Their supply of cars – particularly compacts – remains high, they say.

"When you go through the inventory, you find we've got an 18-day supply of Expedition ELs," said Sam Pack, who owns Five Star Ford in North Richland Hills, Sam Pack's Five Star Ford in Carrollton and Ford Country in Lewisville. "That's too low. It starts costing you sales."



Read more: http://www.dallasnews.com/sharedcontent/dws/bus/stories...

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I had a feeling when gas prices went down this might be a scenario. One would think with modern technology that car makers could be a helluva lot quicker to shift production for demand.

[Indydem]

1. How in the world do you "shift production"?

It takes 2 weeks to change the production tooling to go from making one model year vehicle to the next, and thats the same model. You can't go from making a cobalt to a tahoe in the same plant. Workers need retrained, equipment needs replaced, etc.

The only option is to idle a plant during times of down demand, and ramp it back up in times of high demand. So now you've got workers idle half the time and working overtime the rest. The market is just in a nasty flux right now and I have no idea when it will stabilize.

[RamboLiberal]

2. I doubt if any plant is working 3 shifts at the moment

You up the shifts at the plants or work OT to make the vehicles in demand. And why can't there be a way for plants to have the ability to make more than one type of vehicle? Can't be that much difference in assembly that a worker couldn't be trained to produce more than one type of vehicle.

[Indydem]

4. Learning how to assemble a different model year vehicle...

requires at least 20 hours of training at each station. Its a lot more complicated than you think.

You could retrain relatively easily, but the overhead and cost to replace and reprogram robots, replace stamping dies, retool assembly lines and reroute production components would be staggering.

[RamboLiberal]

5. Fine - but like I said I bet no plant is at full production

Add a shift or go OT - bet none of the autoworkers would turn down the extra hours now. That's one of the problems with the automakers - they don't plan well and they don't react quickly to market shifts.

I'm still amazed at how quickly this country managed to shift production to completely new products, train new workers and get the product out without the computers & robots in WWII.

This country would be in deep doo-doo with our industries today if we ever needed to do that. Remember when we couldn't even ramp up production of up-armored Humvees and MRAPS while auto plants and auto workers stood idle? And we weren't even talking big numbers. So soldiers died and were horribly injured cause the Pentagon and industry had their thumbs up their ass.

At least Ford was thinking about this last year. Automakers should've learned a lesson back in the late 70's and built flexibiltiy in to their plants.

When Ford switches its truck plants, Mulally said, it will design them to be even more flexible going forward, so that the next time the market shifts, Ford can be quicker to respond.

http://www.npr.org/templates/story/story.php?storyId=92...

[WriteDown]

3. I thought GM and Ford MADE people buy these...

There should be zero demand now. I hear that Toyota is discontinuing the Tundra and the Sequoia.

[Coventina]

6. Ahhh, the human race never fails to disappoint.

If gas is cheap, people will guzzle it.

[groundloop]

9. Gas prices will fix that again

With gas pushing $3 per gallon demand for the gas guzzlers will be short lived.

[glowing]

7. Notice where the article is from.. Texas. Perhaps it is difficult in TX to keep

up with the big vehicles. I've seen them sitting around collecting road dust in my area.

[RamboLiberal]

11. In my area Pittsburgh PA I'm seeing a lot of Hummers

last couple of months. A couple of years ago I'd see several a day. Last year when gas was near $4 I saw few Hummers and big SUVs. Now maybe because dealers are offering deals I'm seeing several Hummers a day again.

Also have friends who just bought a Hummer and another who got a new F-150.

[Coventina]

13. I've seen in my area exactly the same as you describe. n/t

[mbperrin]

8. Perhaps we could end the planned obsolescence of yearly model changes

and just bring out new models when they really have something new to offer, rather than shifting around grilles, adding or subtracting chrome, and other typical ways of saying, "You've got the old one! I've got the new one! Nyah, nyah, nyah, nyah, nyah, nyah!"

And maybe we don't need an F150, F150 Ranch Hand, F150 King Ranch, F150 Hand King, F150 Ranch King, F150 King Hand, and Limited and Eddie Bauer Editions of each? (I'm not pickin' on Ford, they all do it!)

Perhaps a smaller lineup of less eccentric models? Then production could continue on long, steady, sustainable runs without all the jerky ups and downs.

Well, it was a thought.....

[groundloop]

10. Well it's ALWAYS BEEN DONE LIKE THAT !!!

Poor excuse, but it seems like the auto industry is a one trick pony.

[AtheistCrusader]

14. I like it when shit goes DOWNHILL year over year, like the Toyota Scion xB

The 06 and down had GOBS of room inside, and a 1.5 litre engine. I get about 36mpg in mine. Plenty of power for a commuter. What did toyota do? Once it 'caught on', they redesigned it. stuffed in a 2.4l engine, and damn near eliminated the back seat legroom. The new one is awful. Can't come anywhere near the original for fuel economy, and doesn't have as much room inside.

My '06 is already at 80k miles. It's in excellent shape, and should last a long time, but if say it got wrecked and I had to replace it today, there is no new car alternative on the market. I'll have to get a used xB. It was hard to get a stick the first time too, so I'll probably get screwed, and be forced to get an Automatic.

Going from 30/35mpg to 22/28mpg was a real improvement, thanks a lot Toyota.

[depakid]

12. See a cliff- or a brick wall, hit the gas.

Then again, when a media outfit is highly reliant on a certain subject for its revenue source, might be a good idea to take what's written with a big grain of salt.

[47of74]

15. Dad's glad he got a new truck for the farm when he did

Dad finally got a new truck for the farm last year as the old one was 25 years old and falling apart. He ordered it in March of last year and got a really good deal on the price. In fact he wished he waited a bit longer because the prices fell even more afterward.

[TrogL]

16. OK that explains where they went

People are reporting all new GM cars in Canada are being loaded on trucks and sent somewhere. Presumably down to the States where there's actually a market.

[Lone_Star_Dem]

17. This article left out the "analysis" which prompted it

It's based on an earlier article by the same person which was printed 2-weeks ago.

Consumers looking for certain models of SUVs or full-size pickups might find them tough to find, some dealers say – partly because of the bankruptcy. All manufacturers had already reduced truck production because of weak sales last year, and additional steep factory cuts by GM this year will likely keep choices limited.

For example, the GM Arlington plant, which builds Chevy Tahoes, GMC Yukons and Cadillac Escalades, is closed for two months.

"Assuming gas prices stabilize, trucks and SUVs are going to be in short supply," said Jerry Reynolds, a former Ford dealer who hosts an auto advice show on Saturdays on WBAP-AM (820). "Dealers are clamoring for product. You can hardly find a new Expedition or Tahoe in this market."

Like many other GM dealers, Carl Sewell has been building his inventory of parts over the last 60 days in case there are disruptions in supply. But he says he is optimistic about the "new" GM.

http://www.dallasnews.com/sharedcontent/dws/bus/stories...

To me it reads like someone in bed with the local dealers hoping to create a bit of local demand.

[RaleighNCDUer]

18. It's all good. In another year or so, when the MORONS realize their

fucking gas guzzling monstrosities are too thirsty to keep filled, it will turn about again.

I watch WAY too much TV, and I have seen that the ads still tout the SUVs and trucks as the vehicles to buy - as long as the companies create the demand, there will be morons to make the demand.

Does ANYONE think we've seen the last of $4 gas?

[bedazzled]

19. you wouldn't know it in west palm beach - miles and miles of unsold suv's

in every car dealer.

hope they eat 'em, too

[dixiegrrrrl]

20. That is strange. Mobile paper trumpting the huge inventory of GM trucks.

Just read the news this am. GM dealers are saying the SE area is seeing good sales of
Chevy Tahoe, other "big" trucks, Cameros, and has inventory.

Glad someone can afford to pay for a truck what I paid for house ( in 1990 prices)