It’s like a financial game of chicken: surely the last thing any one of these companies wants to do is start dumping the cars on the market at fire-sale prices, since that would create a deflationary spiral and likely destroy their industry for years to come. And yet, what else can they do? It’s 2009 now, so most of these cars are already “out of date”.
I suppose that’s why they want the bail-outs so badly – if the bail-out money covers their cost of production they can just gut the existing over-stock, recycle whatever’s possible, and begin working on next year’s (more modest) line of vehicles.
But seriously, those pictures are an amazing testament to our materialistic culture’s need to acquire, acquire, acquire. That’s the build up of only a few months — how many new cars are being built at peek times? Do we really need that many new cars? Have we ever?
@lagavulin: but even with a bailout, if nobody’s buying because the economy’s still tanking… then what?
we need context – what do the normal storage levels look like? the world is a big place, these industries are huge and crank out an amazing number of cars during good times… is this double the number of cars usually stored? 10x? 1x?
Defense.gov News Photo 110426-A-7597S-183: U.S. Special Operations service members with Special Operations Task Force South board two UH-60 Black Hawk helicopters following a clearing operation in Panjwa'i district in Kandahar province, Afghanistan, on April 25, 2011. Source: Wikimedia.
It’s like a financial game of chicken: surely the last thing any one of these companies wants to do is start dumping the cars on the market at fire-sale prices, since that would create a deflationary spiral and likely destroy their industry for years to come. And yet, what else can they do? It’s 2009 now, so most of these cars are already “out of date”.
I suppose that’s why they want the bail-outs so badly – if the bail-out money covers their cost of production they can just gut the existing over-stock, recycle whatever’s possible, and begin working on next year’s (more modest) line of vehicles.
Without a bail-out…well, then what?
Ok, there’s GOT to be something written in code in this one: http://www.guardian.co.uk/business/gallery/2009/jan/16/unsold-cars?picture=342161398
maybe “you really want a new car”
😉
But seriously, those pictures are an amazing testament to our materialistic culture’s need to acquire, acquire, acquire. That’s the build up of only a few months — how many new cars are being built at peek times? Do we really need that many new cars? Have we ever?
@lagavulin: but even with a bailout, if nobody’s buying because the economy’s still tanking… then what?
“this is chilling”? is it?
we need context – what do the normal storage levels look like? the world is a big place, these industries are huge and crank out an amazing number of cars during good times… is this double the number of cars usually stored? 10x? 1x?