Backlog of GM trucks still considerable
Anyone looking for a good deal on a new truck shoudl at GM trucks, as there is a significant backlog. Image from Wikimedia Commons.
If someone wants a new truck, they should get down to the nearest Chevrolet or GMC dealership, where they can get a deal. There is a huge GM trucks backlog as the manufacturer produced too many recently and they likely want some of them off their hands.
Get thee to a dealership of GM trucks
Pickups are the car industry’s bread and butter in the United States, since we Yankees love the things. According to Bloomberg, pickups alone account for 23 percent of General Motors’ sales annual sales. Numbers 1, 2 and 3 on CNN’s 2011 list of the 12 most profitable vehicles were the Ford F-150, Chevrolet Silverado and GMC Sierra and the Ram pickup, respectively, with $50 billion, $40 billion and $18 billion in profits for those manufacturers from 1995 to 2011.
GM, at the moment, is months away from the debut of the 2014 Chevrolet Silverado and GMC Sierra, a redesign that many consider long overdue. General Motors has to idle its truck factories to retool for making the new trucks and before that, overproduced the current models. According to AutoGuide, there is a significant GM truck backlog and they want to get rid of inventory.
Sitting there, parking lot growing out of the tires
Buyers aren’t flocking to GM trucks, though, as Bloomberg points out. The model taking up space at dealerships is not much different from those that hit dealerships seven years ago, when the current generation of Chevrolet and GMC half-ton trucks debuted. Other full-size trucks, meanwhile, have received updates in the meantime and that’s what buyers have been getting themselves into.
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At the moment, an 80- to 85-day supply of the vehicles, or how long the current supply would last at current sales rates before running out, is sitting at dealerships. Typically, automakers like a 60-day supply to 75-day supply. At the end of November, according to AutoBlog, there were 245,853 of them sitting at lots.
Bring A game
In theory, the overproduction was supposed to compensate for the idle factories. However, since fewer people are buying GM trucks, they are sitting on lots and there is a GM truck backlog.
Anyone looking for a new truck but doesn’t mind it being a bit dated design-wise could get a good deal. However, be prepared to bring the “A” game with salesmen, because General Motors isn’t spending as much in incentives and doesn’t want to offer too much in the way of discounts, according to the Wall Street Journal.
However, dealers have an incentive to move inventory. Inventory allocation schemes mandate that dealers that sell a lot of one model get a lot of the new model. Ergo, if they want to get a lot of the next-generation trucks, they have to sell a lot of the old ones, sitting around on the lot, which is good information for prospective buyers to have. So if one was looking at Capital One auto loans for a new truck, this would be a good time.
Sources
CNN: http://money.cnn.com/galleries/2011/autos/1111/gallery.most_profitable_cars/index.html
Wall Street Journal: http://online.wsj.com/article/SB10001424052702304746604577381630912081096.html