Quote:
Originally Posted by DGthe3
Yes and no. Inventory levels are a bit high right now (I think 100 days supply at dealerships, compared to the industry target of 60-90 days). And incentives are pretty high as well (corresponding to over-supply).
But there is a lot more at play here.
It was the 3rd shift at the plant. Generally, you only run those if you initially underestimated demand. 2 shifts are considered ideal, striking the the right balance between productivity and headaches.
Going to 3 shifts creates a number of 'secondary' or 'soft' problems -things that are either an annoyance or temporary issue, but not necessarily a deal breaker. A third shift reduces preventative maintenance capacity, has slightly more quality problems, and is at greater risk to supply problems. Accepting those issues for ~50% more production isn't a bad deal, especially if its only a temporary thing (the 3rd shift was hired back in January as I recall). But not really something that you want to pursue perpetually.
And don't forget that demand for the Camaro is very seasonal. Sales slow down quite a bit in the winter and peak in the summer. Its pretty easy to figure that demand in December will only be ~2/3 of demand in August.
|
I would say they over estimated demand. Going by what I saw in sales, and from local dealers. They expected them to move faster than they did and yes now with winter coming time to slow production.