If you are in need of a new car, I do not envy you. All that and more in The Morning Shift for November 1, 2021.
Inventories at car dealerships are low, and will still be low for some time, according to car dealers at least. That’s who spoke with Automotive News detailing the situation on the ground:
Penske CEO Roger Penske said he expects them to last “at least the next 12 months.” Penske dropped to a 12-day supply of new vehicles in the U.S. at the end of September. For some brands, inventory was even tighter.
“We’re running in the single digits on volume foreign, which is our Toyota, Honda, Nissan, Hyundai-type businesses,” Penske spokesman Anthony Pordon said. “That is something that we are working with the manufacturers to manage every single day.”
AutoNation’s Jackson said he doesn’t expect consumer demand to lessen anytime soon and that the supply-demand imbalance will last into 2022 or “maybe even 2023.” Production increases won’t show up in inventory right away, said Jackson, whose successor, former Fiat Chrysler Automobiles CEO Mike Manley, begins Nov. 1.
AutoNation, the largest U.S. new- vehicle retailer, was down to a lean 10-day supply of new vehicles as of Sept. 30, with just 8,041 cars and trucks on hand. That figure was five times higher at the same point in 2020, according to a regulatory filing.
All of this is funny in that car companies are still making money hand over fist prioritizing high-profit-margin vehicles and leaving everything else on the to-do-list.
It’s not like Joe Biden personally worked to raise gas prices in America (doing something like raising the gas tax would require things like having a regulatory vision for a different America and acting on it), but that hasn’t stopped gas prices from having risen nearly by half during his presidency thus far. Officials are looking for some good way to deflect, as per the Financial Times:
The Biden administration’s senior energy official on Sunday blamed the Opec oil “cartel” for soaring petrol prices in the US, putting more pressure on the group to increase crude output ahead of a meeting later this week.
“Gas prices of course are based on a global oil market. That oil market is controlled by a cartel. That cartel is Opec,” said Jennifer Granholm, the US energy secretary, on NBC’s Meet the Press. “So that cartel has more say about what is going on.”
US petrol prices have risen almost 40 per cent since Joe Biden entered the White House, adding to anxieties about inflation. The federal Energy Information Administration recently forecast winter household heating bills would also surge this year.
The FT pulled some other quotes from Biden himself on the issue that are so devoid of any actual content it’s hard to be sure they’re even English. “I do think that the idea that Russia and Saudi Arabia and other major producers are not gonna pump more oil so people can have gasoline to get to and from work for example is . . . not right.”
The Biden Admin is at least making some progress in promoting union representation, at least in the world of EVs. Things are moving forward with a $4,500 incentive for union-made electric vehicles, and $500 more for union-made batteries in them. Here are some companies that are pissed about it, per Reuters:
Senior executives at 12 major international automakers on Friday urged California’s two U.S. senators to oppose a proposal to give union-made electric vehicles an additional $4,500 tax credit.
The automakers including Toyota Motor Corp, Volkswagen AG, Hyundai Motor Co, and BMW AG.
Here are also some countries pissed about it, taken from another Reuters report:
The European Union, Germany, Canada, Japan, Mexico, France, South Korea, Italy and other countries wrote U.S. lawmakers saying a proposed U.S. electric vehicle tax credit violates international trade rules, according to a joint letter made public Saturday.
A group of 25 ambassadors to Washington wrote U.S. lawmakers and the Biden administration late Friday saying “limiting eligibility for the credit to vehicles based on their U.S. domestic assembly and local content is inconsistent with U.S. commitments made under WTO multilateral agreements.”
All these companies would have to do is encourage their workforce to unionize, which would help everyone involved. Seems simple to me!
Relevant in the context of Japanese automakers and legislators pressuring American regulators against incentivizing their union-made competition is that car sales in Japan are in the toilet, as Reuters reports:
Japan’s automobile sales slumped 31.3% in October from a year earlier to mark the fourth straight month of declines, industry data showed on Monday, a sign output cuts caused by the COVID-19 pandemic were hurting the country’s already weak consumption.
The domestic sales data is among few indicators available so far in gauging the strength of consumption since state of emergency curbs to combat the pandemic were lifted on Sept. 30.
I, too, would be whining about my union-made competitors getting tax breaks if my sales were down by a third in my home market.
VinFast, the Vietnamese startup, has backed out of the project, as Automotive News reports:
The former Holden test track in Australia is on the market for the second time in a year.
The Vietnamese automaker VinFast, which paid $36.3 million for the 2,200-acre property outside Melbourne in late 2020, has since decided to abandon its engineering operations in Australia.
General Motors used the site to develop virtually every Holden built from 1958 until the brand’s shutdown last year. It has an expansive network of roads and a dedicated emissions-testing facility.
If anybody has a few dozen million lying around, this seems like as good a use as any.
The five-mile bridge, including approaches, and the world’s longest suspension bridge between cable anchorages, had been designed by the great engineer Dr. David B. Steinman. Merritt-Chapman & Scott Corporation’s $25,735,600 agreement to build all the foundations led to the mobilization of the largest bridge construction fleet ever assembled. The American Bridge Division of United States Steel Corporation, awarded a $44,532,900 contract to build this superstructure, began its work of planning and assembly. In U.S. Steel’s mills the various shapes, plates, bars, wire and cables of steel necessary for the superstructure and for the caissons and cofferdams of the foundation, were prepared. The bridge was officially begun amid proper ceremonies on May 7 & 8, 1954, at St. Ignace and Mackinaw City.
The bridge opened to traffic on November 1, 1957 according to schedule, despite the many hazards of marine construction over the turbulent Straits of Mackinac.
Are you prepared to square up?