If you’re not familiar with the term “channel stuffing”, let us give you a brief breakdown. The definition of channel stuffing is a deceptive business practice by a company trying to inflate its sales by intentionally sending retailers more products than they can realistically sell to the public. In the automotive world, it means exactly what it sounds like: car dealers get a lot more vehicles than they can handle, hence the reason why you mostly see crowded dealer showrooms and parkings. Millions of vehicles end up this way every year, slowly rotting away day by day. This forces the dealers to buy more land in order to accommodate the vast quantity of unsold cars on the lot.
The world’s recession is still going strong, it never ended, and there is proof to back that up. Don’t believe us? All you have to do is look at the overpopulated dealers and crowded parking lots stretching for miles. None of those unsold cars will ever turn the key or roll further than the few hundred yards to the crusher. There are thousands of so-called “car parks” around the world, but no one talks about them because manufacturers don’t want the public to know how bad the business is going.
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Before you ask why they’re not offering them with a large discount, ask yourself this: would you ever consider buying a car at regular prices if you have the option to buy one at a cheaper price? Remember, both are brand new, there’s nothing to differentiate them apart from the price. Probably not right? That’s why manufacturers can’t afford to sell them at lower prices. Nobody would then buy the regular-priced vehicle.
U.S., Europe, Asia, it’s the same story everywhere. From the UK and Italy to Russia, and from Nissan to BMW, it doesn’t matter who it is. Manufacturers keep buying more and more land to park these unwanted vehicles, with some even resorting to using existing abandoned airports.
The really sad part is that most of the cars arrive from abroad, i.e. get imported into the country where they get parked for the rest of their lives. There doesn’t seem to be an end to the abundant excess of new vehicles anytime soon.
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The problem is that even the manufacturers themselves know that the unsold cars are worthless and destined for the scrapyard as soon as they enter the parking lot. Some even sit for 12 months at a time, which isn’t just detrimental to the plastics and the cabin, but the oil and all liquids inside the motor as well. The tires lose air, batteries go flat and the car can start accumulating rust because of the constant exposure to the elements.
There is no current solution to this massive problem. Factories can’t simply produce the exact amount of vehicles required. Thousands of workers would have to be laid off for that to happen, and that’s before mentioning the fact that the entire metal industry would go haywire. One thing is for sure however: if this issue doesn’t get resolved fairly soon, there won’t be any space to park actual new cars, let alone excess ones.