Sunday, February 08, 2009

Update on automotive channel-stuffing

There are continuing reports of car dealers being pressured by manufacturers to take on excessive inventory:
[Chrysler] has urged its dealers to take on more inventory in February and March as it looks to boost revenue ahead of a first quarter deadline to secure additional government aid and prove that it is viable.

Automakers book revenue when vehicles are shipped to dealers, not when they are sold to customers.
The problem for the dealers is that they already have an average of five months inventory on their lots.

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