Auto Focus

Need Fleet? Get in Line

For small fleets ramping up in the recovery, replacing work vehicles out of stock will be difficult with already tight dealer inventories—except if you’re looking for pickups.

Meeting the needs of small fleets that traditionally buy out of dealer stock is becoming an increasing challenge, according to the dealers that service them. "Now that business is better, there isn't any inventory," says one multi-franchise fleet dealer. "We're going to have one long, dry summer when it comes to new vehicles to sell."

That dealer used to carry 1,200 units of total inventory but is now down to about 250 new cars and trucks. "We'd rather have more inventory, but we can't get [the units]," he says.

On the demand side, this has not been a problem until recently. "In the last year or two, it's been a very negative atmosphere going out and knocking on doors," says a Florida Chevy dealer. "The response was, 'look out back, I have 12 empty trucks. Can you give me a buy figure on them?'"

A lot of those companies eventually went out of business. The ones that survived cut back from 10 to 25 trucks to six or seven, he says.

On the supply side, manufacturers are working through the Japan supply crunch and are upping capacity on some hot vehicles. However, in the post-recession economy and with a smaller manufacturing footprint, manufacturers are no longer building an excess of vehicles and then figuring out a way to sell them. Dealers say that manufacturers have been uncharacteristically quiet about capacities for the 2012 model year.

"Until manufacturers know for an absolute fact that business will be better, they won't increase production," predicts one dealer. "And for the dealers who took their inventories down to nothing, it's going to be a long trip back to a full lot."

On top of that, order-to-delivery times (OTDs) have been elongated in the supply shortage. One large fleet dealer's balance sheet reveals that OTDs have gone from eight to 10 weeks to 14 to 18 weeks, which has only further aggravated in-stock inventory issues.

CONTINUED:  Need Fleet? Get in Line
« Previous  |  1  2  |  Next »

Comment On This Story

Name:  
Email:  
Comment: (Max. 10000 characters)  
Please leave blank:
* Please note that every comment is moderated.

Author Bio

Chris Brown

Executive Editor

Chris is the executive editor of Business Fleet Magazine and Auto Rental News. He covers all aspects of the fleet world.

Newsletter: Sign up to receive latest news, articles, and much more.

Read the latest

Auto Focus Blog: A blog covering fleets, auto rental and the business of cars

The Customer Isn’t Always Right

Not caving to a customer with a blatant agenda may have consequences, especially for a small rental company that relies on stellar Yelp ratings to advertise. But business integrity must prevail.

The Truth Behind Compact Van Depreciation

Why are large van values holding up better than their compact counterparts, and will it last?

Car Rental’s Call to Action on Autonomous Vehicles

The car rental industry has built-in advantages to support a world with driverless cars, but it needs to take the next step in partnering with autonomous vehicle stakeholders.

Job Finder: Access Top Talent. Fill Key Positions.