Auto storage lots not far from here are packed with vehicles. Corporate auto makers have this thing just like they want it.
Profits soaring, labor costs shrinking. Less work, more money.

I think their new favorite words are "market adjustment"

Why would they? Supply and demand will decide the answer to that question……recession is a good example….

Eventually used cars will become overly used. Not enough new cars being made or sold to become the next generation of used cars. Then what?

The best medicine against ‘market adjustments’ is marketplace competition. That’ll come back, rest assured. The adjustment will eventually be negative, when auto storage lots start to overflow. I can wait for that.

I read a story about GM a while back....CEO said they are no longer going to have dealerships full of 100's of vehicles. Inventory management was costing them millions every year. They said in the future they are going to a more limited inventory model with build to suit, and run a leaner, more efficient company.

I guarantee that the EV and foreign manufacturers won’t slow production.

It will be interesting to watch. By not having a lot full of vehicles, they're going to slow demand. Yes, they'll make more per unit but on fewer units. Paying 20-30% more for a vehicle will have people keeping them longer and repairing versus replacing. Eventually people will begin to understand what a worthless proposition it is to own a depreciating asset. They need to be careful that they don't quell their own industry.

If you can control supply you can also control demand. Less supply means more demand.

Very true. Also, for most dealerships, they make as much or more profit on service than they do on actual vehicle sales. I can definitely see the value in GM selling 15-20% less cars but making 15-20% more per car to equal it out.

Service is available in many other places. You can only buy a new vehicle from them.

It would be interesting to validate some of hypotheses on this thread by examining the big auto 10-K and 10-Q reports.

I have not read the article, but I was having this conversation with a family member the other day. My thought was the same. I thoughts were that dealerships would start to follow closer to Tesla's selling model. Dealerships will become more like showrooms than lots full of new cars. Buyers will order direct from the manufacturer either online or with help from the receiving dealership. The dealership will only receive and install any packages or accessories that were purchased and deliver the vehicle to the buyer. Then handle warranty, maintenance, and repairs. Their lots would become mostly trade ins and used vehicles. Even those I think would become more like a carmax business model where they are sold online at fixed prices with no haggle. I could be wrong, but I think that is where the newest generation of vehicle buyers is headed and wanting.

You know...

I would be ok with that if I could order a barebones, no package truck with manual transmission and manual windows maybe even no bed, or comes from the factory with a flatbed.

I doubt they would actually let you have complete control over what you would want. It would cut into their overhead having to maintain that.

Labor is not going down in any market, especially in the car business. Aftermarket shops are generally about ten years behind on what they will attempt to diagnose and repair. None of the economics regarding the corporate side of the business should be attributed to the dealers. Dealers aren't corporate. They are franchises like McDonald's. Dealers have little say in most of the decisions being discussed here. Lots of speculation from those on the outside but generally sales "shows the profit" and service "pays the bills". Basically fixed ops is made to look break even and gets robbed of about half of its production while sales has to "turn a profit". The real money is in used cars...always has been and REALLY is now. Any GMC dealer can sell you a new Sierra but if you want something specific used, there may be only one choice.

My son is a loan officer at a S&L and deals with the scum of the earth car dealers jacking up prices(over list) on people and calling to get loans. He just got the ok from his bosses not to coddle this unethical behavior and to deny the loans. They can just take their business elsewhere.

Back when I was younger very few bought new vehicles off the lot. You went into the dealer and ordered what you wanted. Body style, engine, transmission, exterior and interior color etc. In about a month or so your vehicle would be delivered to the dealer. You got what you really wanted. I liked it like that. You didn't have to pay for a lot of extras you may not have really wanted.

I think that things will get more like before but won't go completely back. There will be some cars on the lot for immediate delivery, but a more limited selection, with more pressure to order what you want.

I think the business model will shift to some sort of shared use or limited lease model once autonomous vehicles become common. The dealerships will ultimately become maintenance and staging facilities for corporate owned vehicles. It’s actually not a bad model for the consumer as the real cost of vehicle ownership is staggering.

Just look @ the ammo....
Scare tacticks...

Look @ ammo prices now...

Tried ta warn ya,
some on here get thar rocks off putting others less fortunate down...
Makes em sleep good @ night...

Whin i post how tough times are, they put me down...

They typical :


Carry on...

Yeah, no one want's to hear idiots whine about the issues they created. Stupid is as stupid does.

Duh 🙄

And if your mind gets right we'll allow you a few creature comforts.