French car dealers are concerned over rising inventory levels as manufacturers, struggling to reduce their own stocks, force-feed them with new vehicles.
The market has seen a sharp decline in customer orders since early October, but dealers say carmakers are continuing to supply them with vehicles that they won’t be able to sell by the end of the year.
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Olivier Lamirault, head of the dealership section of the National Council of Automobile Professionals, told Dow Jones Newswires: “”We saw exactly the same thing at the end of 2008 when the industry was in chaos because of the sub-prime crisis.”
The lobby group said the situation is likely to persist through December and the early months of next year and added that dealers are hurting because the situation is weakening already-strained finances.
Increased inventories are eating into their working capital at a time when sales are down. They see the trend as an attempt by the carmakers to ease their own financial problems at the expense of the dealers.
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