The Detroit News reports: Auto chains limit orders. Man, first it was Auto Nation, but now additional auto dealer chains are chiming in with the "Eh, we're not so sure about selling them domestical-type products."
Bloated inventories of vehicles made by Detroit's Big Three have been a major focus of investors as car retail chains release their third-quarter earnings.That's a problem. How to fix? Well, we're guessing big incentives from Detroit to dealers to move the cars. And then scale back production for 2007.Group 1 Automotive Inc., with 95 U.S dealerships, announced on Tuesday plans to scale back orders for American-made cars in 2007.
AutoNation Inc., the largest U.S. dealer, said last week that it may order 30 percent fewer vehicles from General Motors Corp., Ford Motor Co. and Daimler Chrysler AG in the fourth quarter of 2006.
And Sonic Automotive Inc., with 159 dealers, said though its domestic sales are doing well, foreign and luxury brands make up a larger portion of the company's revenue.
Reduced orders from dealers could prevent the Big Three from meeting inventory goals and, as a result, force more production cuts in 2007.
While these problems are just now coming home to roost, these are the fruits of the seeds Detroit planted long ago. Detroit has the same ability as Japan to plant new seeds to grow great new crops for the future. The first thing Detroit needs to do is regain the trust of the customers it scorned for so many years. And now we've used up all our farming analogies, so we'll stop.
That's a snap of the 2007 Ford Fusion. Ford, please focus (ha!) all your energy on the Fusion to make it the best midsize car available. Right now, it's good. But the competition is also really, really good. Don't let the Fusion die. Please.
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