New car lead times??!!
Discussion
JPJPJP said:
indeed
and until the customer stops being prepared to wait 12+ weeks for a new car, the situation is unlikely to change
By the same token, I could suggest that if customers stopped asking for the best price and expecting massive discounts, then those that do may actually buy a car that is worth something in 3 yrs time.Believe it or not, there is a direct correlation between desirability, restricted supply,low discounting and used values.and until the customer stops being prepared to wait 12+ weeks for a new car, the situation is unlikely to change
TVR1 said:
UK is one of the most profitable markets in the world. The main issue with production is that we are one of very few RHD markets and pretty much the only volume RHD market in the world. We take a fraction of the numbers of cars here,compared to the rest of the world, so will always be at the back of the queue and you can't just swap production to RHD, if you want to.
Not so. A modern car plant is highly flexible and can build any specification at any time, including LHD and RHD cars at the same time. Just-In-Time delivery of parts and assemblies to the trackside enables this to happen. The manufacturer's computer system schedules the build sequence way in advance and suppliers deliver parts and assemblies to match.What makes life more difficult for the manufacturer is when they're setting up supply arrangements and don't know what overall volumes to project.
Colonial said:
Put a deposit on a Golf R on January 4 of this year.
Expected delivery of July-ish. Maybe.
Just as well I'm in no real hurry. If my current car sells I'll do some bangernomics for a few months. No big drama.
How can a 7 month lead time be right when I could pop out and buy 23 this afternoon (according to the vw website, there are 23 in stock, a lot of which are - in practical terms - new?Expected delivery of July-ish. Maybe.
Just as well I'm in no real hurry. If my current car sells I'll do some bangernomics for a few months. No big drama.
why has vw wasted build slots on cars that pop up as used with 10 miles on the odo when there are people waiting 7 months for a new one?
in any other industry it would be called madness
TVR1 said:
By the same token, I could suggest that if customers stopped asking for the best price and expecting massive discounts, then those that do may actually buy a car that is worth something in 3 yrs time.Believe it or not, there is a direct correlation between desirability, restricted supply,low discounting and used values.
hardly the fault of the individual punter though, its fleet buyers that are responsible for that in the main.and it's normal market economics
especially prevalent when the incentive schemes for dealers are disconnected from making the whole supply chain as efficient as can be.
Ozzie Osmond said:
Not so. A modern car plant is highly flexible and can build any specification at any time, including LHD and RHD cars at the same time. Just-In-Time delivery of parts and assemblies to the trackside enables this to happen. The manufacturer's computer system schedules the build sequence way in advance and suppliers deliver parts and assemblies to match.
What makes life more difficult for the manufacturer is when they're setting up supply arrangements and don't know what overall volumes to project.
Perhaps I should have been more specific. Of course a plant is flexible etc. But once the split of cars ie LHD/RHD Auto/Man is decided and production is scheduled and parts ordered (as you say 'way in advance') then if suddenly the manufacturer gets an order for diesels when they have scheduled petrols, then that can push production back a month or so. Where I am, assuming factory ordering is open for any particular model, 12-15 weeks is about the norm for a fresh order. Up to approximately 6 weeks before build we can change major items, engine/gearbox etc and then minor items like colour/options until about 2 weeks before.What makes life more difficult for the manufacturer is when they're setting up supply arrangements and don't know what overall volumes to project.
As for RHD/LHD, whilst some maufacturers can build them both in the same plant, many can't or logistically, don't want to. I work for a specialist arm of a manufacturer and we have RHD cars built in 'batches' for example.
The basic issue in the current economic climate, is that manufacturers don't want to build unless they have orders and if they do build,they want to make sure those cars will sell, hence the lead times.
TVR1 said:
Perhaps I should have been more specific. Of course a plant is flexible etc. But once the split of cars ie LHD/RHD Auto/Man is decided and production is scheduled and parts ordered (as you say 'way in advance') then if suddenly the manufacturer gets an order for diesels when they have scheduled petrols, then that can push production back a month or so. Where I am, assuming factory ordering is open for any particular model, 12-15 weeks is about the norm for a fresh order. Up to approximately 6 weeks before build we can change major items, engine/gearbox etc and then minor items like colour/options until about 2 weeks before.
As for RHD/LHD, whilst some maufacturers can build them both in the same plant, many can't or logistically, don't want to. I work for a specialist arm of a manufacturer and we have RHD cars built in 'batches' for example.
The basic issue in the current economic climate, is that manufacturers don't want to build unless they have orders and if they do build,they want to make sure those cars will sell, hence the lead times.
why is production scheduled way in advance? that is in the interest of the factory, not the customerAs for RHD/LHD, whilst some maufacturers can build them both in the same plant, many can't or logistically, don't want to. I work for a specialist arm of a manufacturer and we have RHD cars built in 'batches' for example.
The basic issue in the current economic climate, is that manufacturers don't want to build unless they have orders and if they do build,they want to make sure those cars will sell, hence the lead times.
automotive is one of the last 'consumer supply' industries to get its head round the fact that a supply chain should be focussed on the needs of the customer first: the needs of the factory are way down the list imo
if you are right in that manufacturers don't want to build unless they have orders, they should differentiate better between a dealer order and a consumer order - that way the poster above who is waiting 7 months for a Golf R wouldn't have to suffer seeing 27 nearly new ones for sale on the vw site... 27 build slots down the toilet really.
JPJPJP said:
TVR1 said:
By the same token, I could suggest that if customers stopped asking for the best price and expecting massive discounts, then those that do may actually buy a car that is worth something in 3 yrs time.Believe it or not, there is a direct correlation between desirability, restricted supply,low discounting and used values.
hardly the fault of the individual punter though, its fleet buyers that are responsible for that in the main.and it's normal market economics
especially prevalent when the incentive schemes for dealers are disconnected from making the whole supply chain as efficient as can be.
Took 8 weeks for my Alfa Giulietta to be on my drive after ordering. Was quoted 12weeks.
Colleague at work waited 8-9 months for a Audi Q5 and another colleague as ordered an A3 Sportback 2.0TDi Sport and has been told 8 months. Another chap has just had a new 5-Series and waited about 12 weeks.
Colleague at work waited 8-9 months for a Audi Q5 and another colleague as ordered an A3 Sportback 2.0TDi Sport and has been told 8 months. Another chap has just had a new 5-Series and waited about 12 weeks.
I've heard that the A5 currently has a ridiculous waiting list which I should imagine relates to desirability. They seem to the middle-management company car of choice at the moment. Something like 10 months! I'm currently waiting for a 1-series and was also quoted 12 weeks like those above.
I was under the impression that the long lead times are a simple consequence of stock levels being greatly reduced as a cost saving measure by everyone in the supply chain following the recent financial difficulties. The manufacturers may have a decent JIT system for part supply but these still need to be manufactured from other smaller parts etc etc. A smaller quantity of stock at each stage will reduce flexibility and a parts manufacturers ability to supply to demand.
I was under the impression that the long lead times are a simple consequence of stock levels being greatly reduced as a cost saving measure by everyone in the supply chain following the recent financial difficulties. The manufacturers may have a decent JIT system for part supply but these still need to be manufactured from other smaller parts etc etc. A smaller quantity of stock at each stage will reduce flexibility and a parts manufacturers ability to supply to demand.
JPJPJP said:
TVR1 said:
Perhaps I should have been more specific. Of course a plant is flexible etc. But once the split of cars ie LHD/RHD Auto/Man is decided and production is scheduled and parts ordered (as you say 'way in advance') then if suddenly the manufacturer gets an order for diesels when they have scheduled petrols, then that can push production back a month or so. Where I am, assuming factory ordering is open for any particular model, 12-15 weeks is about the norm for a fresh order. Up to approximately 6 weeks before build we can change major items, engine/gearbox etc and then minor items like colour/options until about 2 weeks before.
As for RHD/LHD, whilst some maufacturers can build them both in the same plant, many can't or logistically, don't want to. I work for a specialist arm of a manufacturer and we have RHD cars built in 'batches' for example.
The basic issue in the current economic climate, is that manufacturers don't want to build unless they have orders and if they do build,they want to make sure those cars will sell, hence the lead times.
why is production scheduled way in advance? that is in the interest of the factory, not the customerAs for RHD/LHD, whilst some maufacturers can build them both in the same plant, many can't or logistically, don't want to. I work for a specialist arm of a manufacturer and we have RHD cars built in 'batches' for example.
The basic issue in the current economic climate, is that manufacturers don't want to build unless they have orders and if they do build,they want to make sure those cars will sell, hence the lead times.
automotive is one of the last 'consumer supply' industries to get its head round the fact that a supply chain should be focussed on the needs of the customer first: the needs of the factory are way down the list imo
if you are right in that manufacturers don't want to build unless they have orders, they should differentiate better between a dealer order and a consumer order - that way the poster above who is waiting 7 months for a Golf R wouldn't have to suffer seeing 27 nearly new ones for sale on the vw site... 27 build slots down the toilet really.
Production is scheduled way in advance because a car is made from parts from many differnt suppliers. You can't just get up one morning and expect 10,000 engines to be there the next day, or is that unreasonable?
Of course, in an ideal world, the factory would only build cars for customers as and when they came in, one at a time rather than in batches but I am sure you can see that is unrealistic.
As for customer v dealer orders, well that has always been a sore point. The way manufacturers look at it is if the dealer doesn't have cars in the showroom then how can they sell? A sold car is a sold car, the customer will wait. Harsh? Yes but the reality of manufacturing. The other side of that coin is customers complaining because 'you never have the right car in stock'.
The reality is that the manufacturer is never going to win this discussion.Over production?-car sits around for months and customer complains that they have an 'old' car. What can you do?
Frik said:
I've heard that the A5 currently has a ridiculous waiting list which I should imagine relates to desirability. They seem to the middle-management company car of choice at the moment. Something like 10 months! I'm currently waiting for a 1-series and was also quoted 12 weeks like those above.
I was under the impression that the long lead times are a simple consequence of stock levels being greatly reduced as a cost saving measure by everyone in the supply chain following the recent financial difficulties. The manufacturers may have a decent JIT system for part supply but these still need to be manufactured from other smaller parts etc etc. A smaller quantity of stock at each stage will reduce flexibility and a parts manufacturers ability to supply to demand.
A5 is a good example of ALL the issues. Until fairly recently, the UK was the ONLY RHD market. Australia and South Africa only had the car at the start of last year. Coupled with the disaterous 2008/2009, they simply didn't want to build cars until they new they would sell. Also, many people don't appreciate that the major suppliers, engines,gearboxes etc don't actually get paid until those items are used. You can't expect suppliers to make things that they won't get paid for.I was under the impression that the long lead times are a simple consequence of stock levels being greatly reduced as a cost saving measure by everyone in the supply chain following the recent financial difficulties. The manufacturers may have a decent JIT system for part supply but these still need to be manufactured from other smaller parts etc etc. A smaller quantity of stock at each stage will reduce flexibility and a parts manufacturers ability to supply to demand.
I have run the numbers and taking the cash option works out slightly cheaper over the 4 year life of the car than getting a company car. Even budgeting for a full set of tyres a year!
Work still insure the car so that's a huge saving!
I wouldn't mind so much but at the dealer yesterday they told me the demo car is for sale, but the finance rates on used cars are no where near as good as for new ones. So buying the demo would cost about 50quid more a month!
Even bigger pain is I cant make some money with bangernomics as my company specify loads of things including a max age of 5years
I am very tempted to nominate my wifes car and not have anything while the skoda gets built!
Just got to remember as well as the money saving I'm gettin rid of the crap lease company we have to deal with!
J
Work still insure the car so that's a huge saving!
I wouldn't mind so much but at the dealer yesterday they told me the demo car is for sale, but the finance rates on used cars are no where near as good as for new ones. So buying the demo would cost about 50quid more a month!
Even bigger pain is I cant make some money with bangernomics as my company specify loads of things including a max age of 5years
I am very tempted to nominate my wifes car and not have anything while the skoda gets built!
Just got to remember as well as the money saving I'm gettin rid of the crap lease company we have to deal with!
J
Jay12329 said:
I have run the numbers and taking the cash option works out slightly cheaper over the 4 year life of the car than getting a company car. Even budgeting for a full set of tyres a year!
Work still insure the car so that's a huge saving!
I wouldn't mind so much but at the dealer yesterday they told me the demo car is for sale, but the finance rates on used cars are no where near as good as for new ones. So buying the demo would cost about 50quid more a month!
Even bigger pain is I cant make some money with bangernomics as my company specify loads of things including a max age of 5years
I am very tempted to nominate my wifes car and not have anything while the skoda gets built!
Just got to remember as well as the money saving I'm gettin rid of the crap lease company we have to deal with!
J
Glad it works out for you, particularly with the insurance-a big bonus. Customers have never quite got the finance rate thing but in simple terms, new car rates are lower to make up the difference in purchase price and besides, if no one bought new,there wouldn't be any used cars. The manufacturer wants to sell new cars, used are up to the dealers!Work still insure the car so that's a huge saving!
I wouldn't mind so much but at the dealer yesterday they told me the demo car is for sale, but the finance rates on used cars are no where near as good as for new ones. So buying the demo would cost about 50quid more a month!
Even bigger pain is I cant make some money with bangernomics as my company specify loads of things including a max age of 5years
I am very tempted to nominate my wifes car and not have anything while the skoda gets built!
Just got to remember as well as the money saving I'm gettin rid of the crap lease company we have to deal with!
J
Jay12329 said:
I have run the numbers and taking the cash option works out slightly cheaper over the 4 year life of the car than getting a company car. Even budgeting for a full set of tyres a year!
Work still insure the car so that's a huge saving!
I wouldn't mind so much but at the dealer yesterday they told me the demo car is for sale, but the finance rates on used cars are no where near as good as for new ones. So buying the demo would cost about 50quid more a month!
Even bigger pain is I cant make some money with bangernomics as my company specify loads of things including a max age of 5years
I am very tempted to nominate my wifes car and not have anything while the skoda gets built!
Just got to remember as well as the money saving I'm gettin rid of the crap lease company we have to deal with!
J
one moment of hassle could negate that small saving and 4 years is a long time - who has liability for the finance if the company goes pop or makes you redundant for instance?Work still insure the car so that's a huge saving!
I wouldn't mind so much but at the dealer yesterday they told me the demo car is for sale, but the finance rates on used cars are no where near as good as for new ones. So buying the demo would cost about 50quid more a month!
Even bigger pain is I cant make some money with bangernomics as my company specify loads of things including a max age of 5years
I am very tempted to nominate my wifes car and not have anything while the skoda gets built!
Just got to remember as well as the money saving I'm gettin rid of the crap lease company we have to deal with!
J
TVR1 said:
Ok.Lets start off with an example. If you wanted to buy a sofa from a decent chain, for example Sofa So Good, would you think it normal to wait 2 months for delivery? You probably would, because you understand that they can't possily keep every sofa/material/frames etc in stock all the time.
Production is scheduled way in advance because a car is made from parts from many differnt suppliers. You can't just get up one morning and expect 10,000 engines to be there the next day, or is that unreasonable?
Of course, in an ideal world, the factory would only build cars for customers as and when they came in, one at a time rather than in batches but I am sure you can see that is unrealistic.
As for customer v dealer orders, well that has always been a sore point. The way manufacturers look at it is if the dealer doesn't have cars in the showroom then how can they sell? A sold car is a sold car, the customer will wait. Harsh? Yes but the reality of manufacturing. The other side of that coin is customers complaining because 'you never have the right car in stock'.
The reality is that the manufacturer is never going to win this discussion.Over production?-car sits around for months and customer complains that they have an 'old' car. What can you do?
But the sofa shop doesn't have 27 that have only been sat on once by someone in clean silk pyjamas on the showroom floor at 15% discount to the price of a new one...Production is scheduled way in advance because a car is made from parts from many differnt suppliers. You can't just get up one morning and expect 10,000 engines to be there the next day, or is that unreasonable?
Of course, in an ideal world, the factory would only build cars for customers as and when they came in, one at a time rather than in batches but I am sure you can see that is unrealistic.
As for customer v dealer orders, well that has always been a sore point. The way manufacturers look at it is if the dealer doesn't have cars in the showroom then how can they sell? A sold car is a sold car, the customer will wait. Harsh? Yes but the reality of manufacturing. The other side of that coin is customers complaining because 'you never have the right car in stock'.
The reality is that the manufacturer is never going to win this discussion.Over production?-car sits around for months and customer complains that they have an 'old' car. What can you do?
if there is a 7 month wait list for a car, I would expect the factory to be running full tilt and that is a known number of cars per day. There is no immediate need for 10k engines tomorrow, just those that are needed for tomorrow's production. Sure there will be bottlenecks but all can be overcome if the will is there.
After all, Walkers need potatoes and they need to be planted 9 months in advance...but, on Tuesday, they will be delivering what Tesco order from them on Monday.
I don't claim to have any complete answers to the problem but I can see a number of ways of shortening the lead time - whether they are economically the right thing for the car industry is another question: given that there are plenty of people with big brains in the industry, maybe not.
Our fleet manager sent us all an email only a couple of weeks ago stating german marques delivery times were going up from the usual 14-16 weeks. My current Ford was 16 weeks delivery in 2008. My company car is due for replacement in October and I have been told should order now if I wanted Audi/BMW/VW etc. mama mia.
TVR1 said:
By the same token, I could suggest that if customers stopped asking for the best price and expecting massive discounts, then those that do may actually buy a car that is worth something in 3 yrs time.Believe it or not, there is a direct correlation between desirability, restricted supply,low discounting and used values.
Perhaps car makers should price them correctly then? If I can get 10% off a BMW then stop the messing around and price it 10% lower? The market dictates the price and if the manufacturer has to discount to sell then his prices are out of line, not the punter.JPJPJP said:
Jay12329 said:
I have run the numbers and taking the cash option works out slightly cheaper over the 4 year life of the car than getting a company car. Even budgeting for a full set of tyres a year!
Work still insure the car so that's a huge saving!
I wouldn't mind so much but at the dealer yesterday they told me the demo car is for sale, but the finance rates on used cars are no where near as good as for new ones. So buying the demo would cost about 50quid more a month!
Even bigger pain is I cant make some money with bangernomics as my company specify loads of things including a max age of 5years
I am very tempted to nominate my wifes car and not have anything while the skoda gets built!
Just got to remember as well as the money saving I'm gettin rid of the crap lease company we have to deal with!
J
one moment of hassle could negate that small saving and 4 years is a long time - who has liability for the finance if the company goes pop or makes you redundant for instance?Work still insure the car so that's a huge saving!
I wouldn't mind so much but at the dealer yesterday they told me the demo car is for sale, but the finance rates on used cars are no where near as good as for new ones. So buying the demo would cost about 50quid more a month!
Even bigger pain is I cant make some money with bangernomics as my company specify loads of things including a max age of 5years
I am very tempted to nominate my wifes car and not have anything while the skoda gets built!
Just got to remember as well as the money saving I'm gettin rid of the crap lease company we have to deal with!
J
A friend of mine was recently one of 9 salesmen when the company made 4 redundant. 5 salesman had their own cars and 4 had company cars. Those made redundant all had their own cars - coincidencs?
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