
Each one of those tiny dots is a brand-new car. Zillions -- literally zillions! -- of unsold cars are piling up in makeshift parking lots around the world. I see bargains in the future. (photo originally credited to David Goddard of Getty, via the Guardian)
Wow. That is a lot of unsold cars.
I read a few months ago that cars were beginning to pile up at Los Angeles ports, but a photo really makes the sheer numbers hit home.
A 10-photo gallery from around the world hits them home even harder. There are some mind-boggling pics there, including the one above.
But that’s not all! Cars need gas, and the oil to make that gasoline is piling up as well: oil prices are so low that some people are actually holding on to their barrels and to their tanker ships and saying, essentially, that they’ll wait and see, betting that the price will go up sooner rather than later.
In fact, so many people are hoarding supplies of oil that the world is running out of places to store it. I’m serious.
But, of course, as soon as the price of oil starts to rebound, all of these hoarders are going to rush to cash in, selling off their supplies, and adding their glut of stored oil to the market — this excess supply is probably going to keep oil prices depressed for a relatively long time.
That’s interesting — but let’s get back to those cars. Unlike oil, which you can just store and store and store, and sell whenever you want, cars depreciate.
Sure, they say that a car loses most of its value the second you drive it off the dealer’s lot, but what if it never gets to a lot in the first place?
What’s going to happen in about nine months, when the 2010 models start arriving in showrooms? How much do you think that still-shiny-new 2009 — or 2008! — will be on sale for then? Right now it’s sitting in limbo — technically it’s still on the balance sheets at sticker price. But there’s no way a car company will be able to sell them at sticker price if they’re last year’s model.
Plus, these are not the super-fuel-efficient awesome cars we’ve been promised are right around the corner — these are the old-model cars, SUVs and the like. Maybe, if gas prices stay down, trucks and SUVs at bargain prices will fly off of dealer lots — but that doesn’t help society at all.
And selling new cars at used-car prices i’s not really going to help the automotive industy, either.
But if you’re in the market for a new car, I’ll bet 2009 is going to be a very cheap year for you.