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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: CalculatedRisk who wrote (73313)	10/31/2006 6:50:06 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

Countering, the Alice in Wonderland view of “things”, were the comments by Autonation (the largest auto dealer in the US) in it’s conference call explaining why they were slashing orders to the Big Three by 30%. AN advised the auto makers to “move into the real world”, pointing out that Detroit estimates inventories on retail lots by including fleet sales in the turnover calculations. GM, according to auto-sales tracking firm Autodata Corp., has 76 days’ supply of inventory. But Auto Nation says the number, minus fleet sales, is actually 94 days’ worth. Ford’s reported inventory is 75 days’ supply, but Auto Nation claims it is actually 105 days. Chrysler says the number is 82 days, whereas Auto Nation estimates it to be 126 days’ supply. Moreover, Auto Nation says that a 60 days’ supply is ideal and the average for the Big Three (108) is unacceptable. Ford does move into the real world today, by announcing a further production cut of 8-12% in the first half of 07, on top of the 16% already cut in the second half of 06.