New Car Shortage (We Told You It Would Happen) is Good News For Industry

Editors Note: As I drove down Interstate 75 this past Tuesday, I saw something I hadn't seen in many months, transport trucks filled with new cars...mostly Fords, lots of new vehicles heading South from Detroit...Hooray!

Washington DC September 10, 2009; The AIADA newsletter reported that after struggling with historically low auto sales for much of the past year, automakers are confronting a more-welcome problem: some of the lowest inventory levels in about three decades.

According to the Detroit Free Press, with auto factories abuzz to replenish low stocks of cars – a consequence of the popular cash-for-clunkers program that ended last month – it's a problem that workers are greeting with open arms, too.

The number of cars and trucks on dealership lots across the United States has dipped to the lowest level since at least 1975, according to WardsAuto.com, which assembles detailed data on the auto industry. That is largely a consequence of the Cash for Clunkers program, which gave consumers an incentive to turn in their old cars and trucks for more fuel-efficient, modern models.

While that has left dealers and consumers craving scarce products, which could cost automakers some sales, it has brought many autoworkers back to work and stimulated some optimism after a long recession.

By the end of August, the amount of inventory on dealership lots or in the process of being delivered to dealerships fell to 1.4 million vehicles, or 49 percent less than at the end of last August, according to Ward's data.

Click Here to read more on vehicle shortages on dealer lots.