Where The World's Unsold Cars Go To Die

Posted by khalling 11 years, 6 months ago to Economics
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Two things:
1.Recession evidence
2.Artificial Pricing. The auto makers prefer to keep production going but do not sell-off at huge discount to clear out inventory in mature industries where demand has dropped. Question: Why do they keep production up?

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  • Posted by Solver 11 years, 6 months ago
    It just goes to show that there are some who are so scared of prices going down that they will do just about anything to try and prevent it. They also tend to use, encourage or push huge debts as a means of showing others that things are growing. When prices go down, savers can buy more, while debtors can buy even less.
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  • Posted by Maphesdus 11 years, 6 months ago
    So THAT'S why GM nearly went bankrupt and needed a bailout! They're producing an excessive supply which exceeds the public demand for their products. If too many products go unsold, then of course the company is going to run into trouble. It costs money to produce products, and that cost is supposed to be covered by the sale of the product. But if those products just get stored somewhere instead of being sold, then that's just money down the drain. Doubly so since they're also having to purchase land for storage. This whole thing just sounds like a huge money sink.

    Now here's the real question: Why are corporations attempting to control the economy instead of simply adjusting their supply to respond to market demand?
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