Dealers are still integral to the makers (faux) success.
The manufacturers take revenue on shipments to the dealer, not the sell-thru to the end consumer. This allows them to stuff the channel to hit their numbers. Of course, this becomes unsustainable once the effectiveness of discounts & incentives hits the wall and they can't clear the inventory in time for the next stuff job. See 2008 Big-3 explosion, the dealer channel had YEARS worth of inventory of some makes/models.
It's very fair to assume this is a fundamental reason the manufacturers will defend the dealer network to the death. Without it, sales numbers would, by necessity, become a reflection of true demand... Short-term thinking for sure, but very hard to unwind.
Comments
Dealers are still integral to the makers (faux) success.
The manufacturers take revenue on shipments to the dealer, not the sell-thru to the end consumer. This allows them to stuff the channel to hit their numbers. Of course, this becomes unsustainable once the effectiveness of discounts & incentives hits the wall and they can't clear the inventory in time for the next stuff job. See 2008 Big-3 explosion, the dealer channel had YEARS worth of inventory of some makes/models.
It's very fair to assume this is a fundamental reason the manufacturers will defend the dealer network to the death. Without it, sales numbers would, by necessity, become a reflection of true demand... Short-term thinking for sure, but very hard to unwind.