The average number of vehicles sitting on General Motors’ dealership and inventory lots has shrunk by nearly 50 percent in the past year.
According to Automotive News, GM had just 334,628 vehicles sitting in its inventory as of last week, down from 668,443 vehicles during the same time period last year.
GM inventories were already running low at the beginning of 2020 following the 40-day UAW strike in late 2019. The automaker didn’t have much time to claw back any lost inventory before the COVID-19 pandemic forced it to shut its plant back down. Increased demand for popular vehicles like full-size trucks and SUVs and certain crossover models made it hard for it to establish a stockpile of vehicles throughout 2020, as well – an effect that has lasted into 2021.
The ongoing semiconductor chip shortage is also now taking a bite out of GM production, forcing it to idle several of its plants in both North America and abroad. The automaker is prioritizing the small number of chips that it does have for its most profitable and best-selling vehicle, like the Chevy Silverado and Chevy Tahoe, for example.
This may seem like bad news on the surface, but low inventory may just be the new normal for GM. Senior marketing manager for Chevrolet SUVs, Brad Franz, told GM Authority earlier this year that the popularity of certain vehicles like trucks and crossovers will make it hard to establish a 100+ day inventory as it had in previous years.
“When we’re selling at the rate that we’re selling them, inventory is tight,” Franz told GM Authority executive editor Alex Luft. “So the build-up is challenging. We are starting to rebound, but [inventory] is tight. We are selling them as fast as we get them on dealer lots, Trailblazer in particular.”
“We will just have to live in an environment where we get a little more comfortable running lean,” Franz added. “We’re definitely a little leaner than we want to be, but we still believe we have the inventory on the ground to hit our objective.”