Posted on 10/28/2013 11:27:01 AM PDT by jazusamo
The past month has brought much confusion and concern for General Motors' shareholders regarding the most important and profitable segment of sales for the company. As the company prepares to report earnings for the third quarter this week, media reports are still unclear on just what is going on with GM's new truck lineup; specifically pertaining to the reasons behind the disappointing sales figures that were reported for the month of September when Ford's truck offerings left them in the dust.
While GM's Obama-appointed management spun the story ( claiming supply could not keep up with demand ) to some in the media who are gullible enough to print the misinformation without question, some GM dealers were more honest with their assessment.
GM's management has lots of experience when it comes to trying to deceptively explain away poor sales of much-hyped vehicles. The Chevy Volt has never lived up to expectations and the same "supply can't keep up with demand" excuse was used, even as GM temporarily halted production at plants making the vehicle due to the embarrassing sales. As those in GM management present their case as virtuously as politicians seeking reelection, some at GM's dealerships (who have a bit more credibility) give a clearer picture as reported by Automotive News.
The article quotes one Florida Chevy dealership general manager as saying that the 2014 Chevy Silverado (GM's bread and butter pickup) is selling "very poorly." The president of another dealership in Texas says his supply of Silverados was up to 170 days compared to his previous average of 110 days. Yet another principal of four Texas dealerships said his truck supply was up to 120 days compared to the typical 90 day supply. Assuming that the management and owners of Chevy dealerships are not part of a right-wing conspiracy to hurt GM because of its ties to President Obama, it would appear that we can put to rest the notion that the lackluster sales for GM's new truck lineup is a result of supply not being able to keep up with demand.
GM dealers are pointing to the simple fact that competitors have better deals on their truck offerings and consumers can get better bang for their buck elsewhere. Of course, the dealers would like to see increased incentives on the vehicles to spur sales; a remedy that hurts profits and shareholders at GM. The ingenious response from GM? Trick consumers by raising prices of the trucks and then increasing incentives ! As PT Barnum (or perhaps a White House spokesman) might say, "There's a sucker born every minute!"
Another Automotive News report blows holes in the "supply can't keep up with demand" excuse. The piece states, "GM started October with an 82-day supply based on September's sales pace, up 18 from Sept. 1. Stocks of the Chevrolet Silverado pickup rose to a 115-day supply from 98, and the GMC Sierra pickup rose to 98 days from 87." GM no longer likes to discuss truck inventory, which it has had a past history of stuffing to manipulate earnings, but analysts should ask some tough questions during GM's earnings' conference call about where truck inventory levels are. The tricky strategy of raising truck prices at the same time that incentives are raised should also be questioned. Judging from GM's past explanations, even if such questions are allowed to be asked, I doubt that the answers will be credible.
I just don't get why GM has to continue to play its politically dishonest approach to all challenges it faces. It seems that the governmental intrusion into the company has left an indelible template that sets forth a strategy by GM of smoke and mirrors along with media manipulation to portray an image of an efficiently managed entity operating with an eye on the bottom line when in reality it is most concerned with public perception. The true bottom line is, if GM does not focus on building high quality vehicles at the best value in a very competitive market instead of being concerned with perception, all of the excuses in the world will not prevent a second trip for the company through bankruptcy court.
Mark Modica is an NLPC Associate Fellow.
Related:
Survey: Auto Bailout is a Drag on GM Truck Sales
Im hoping to get a 2006 F250 on the cheap soon...
Me either. I figure I’ve already paid for 3 or 4 of their cars why spend my personal money on them too.
First it was the lifters, my mechanic, said they were defective from the manufacturer but no recall yet, that cost me $2400 and a total engine rebuild. Then 1000 miles later it could not hold oil pressure. Took it back to my mechanic and after a week he finally tore the engine apart again to discover another manufacturing defect, a defective crankshaft bearing. Had to have a new engine block ordered and delivered and the engine all put back together again, $3300 this time.
I hate that company, I will demand them pay for the repairs, but first have to get through the engine break in period to see if anything else goes wrong.
Toyota isn't denying it, and also just put a picture of a 2014 Tundra on Hino's website front page with no other comment.
Who knows what will really happen, but there isn't one domestic US work truck manufacturer that wants to see Toyota rolling coal in a turbo diesel dually truck that can tow 25,000 pounds or haul 8,000 pounds in the bed.
I admit I’m sort of out of the loop on this sort of thing, but doesn’t GM still offer the Colorado/Canyon twins?
That smell is summed up in three letters...EPA.
No extended cabs.
You have to buy regular or four door.
And no more 8.1 vortec for even the duallies.
Plus its Obama ruled.
That is why.
Wish Toyota would bring back their small stripped down pickups. Those would sell quickly to people who can’t afford GM’s over priced double cabs with every bell and whistle imaginable. Chevy’s Silverado used to be the best out there but now it’s a hybrid and sticker priced at over $50k. No one today has a spare $50k in their wallets for a new pickup.
http://usnews.rankingsandreviews.com/cars-trucks/Chevrolet_Silverado-1500-Hybrid/
MSRP: $41,135 - $51,490
It wasn’t that long ago that you could buy a decent house for that.
As Obamacare rolls out, the money that would have been spent buying cars will be gone. Car sales will drop anyway.
That would be great! Toyota already blows all 1/2 ton trucks way out of the water.
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