For Fernando Varela, who has three Ford stores and a four-brand General Motors store in pickup-loving eastern Texas, "it's going to be an interesting summer."
Varela said he anticipates a shortage of light trucks across the board, especially pickups, as factories ramp up production after a two-month shutdown because of the coronavirus.
He estimated his GM inventory to be about 20 percent below where it should be, while his Ford inventory is off 5 percent. That's after Varela heavily stocked up on vehicles early in the year, which seemed like a bad move in March and April but now is paying off.
U.S. dealers are heading into the summer wondering whether they'll have enough trucks — especially from GM.
At Castriota Chevrolet in Hudson, Fla., dealer principal Tom Castriota said light-truck inventory levels have not returned to normal since the 40-day UAW strike against GM in September and October. "So we're paying a double whammy, so to speak, from it as a GM dealer," he said.
Some of the shortage is being supplemented with used vehicles. Castriota said the store sold a high number of used midsize Colorados and full-size Silverados last month.
Pickup popularity has not been sapped by the economic effects of the pandemic, which plunged auto sales in April to the slowest pace since the federal government began publishing monthly figures in 1976. Sales of new pickups handily outperformed the market in the week ending June 1, according to J.D. Power. While total retail sales were off by 12 percent, large pickup sales rose 5 percent, and midsize pickup sales climbed at the same rate. Sales of midsize SUVs declined 8 percent, compact SUVs fell 11 percent and compact cars dropped 33 percent.
Meanwhile, the no-interest, seven-year loans that many customers seized upon in May are no longer available on large, light-duty pickups, according to J.D. Power.
Pete DeLongchamps, senior vice president of manufacturer relations, financial services and public affairs at Group 1 Automotive Inc., said the group's GM truck inventory is "probably lower than we would like it," but Ford inventory seem to be fine.
"The next 30 to 45 days of production is going to be really telling for the end of the summer and into the fall," he said.
For the Detroit 3, overall vehicle supply is notably down for GM but similar to year-earlier levels for Ford Motor Co. and Fiat Chrysler Automobiles, according to estimates from Morgan Stanley. The firm said days' supply for May was estimated to be 60 for GM, down from 78 in May 2019. Ford's supply was estimated at 76 days, compared with 75 a year earlier, and FCA was at 68 days, vs. 70 last year.
GM is running three shifts at its truck plants in Wentzville, Mo.; Flint, Mich.; and Fort Wayne, Ind., though it is gradually ramping up production while workers adjust to new safety procedures, spokesman Jim Cain said.
GM CEO Mary Barra said at an industry event last week that the automaker will be close to normal capacity by the end of this month, if not sooner. "It's important now, especially with trucks, that we are getting vehicles back online," she said.
Most Detroit 3 auto plants in North America were closed from mid-March to May 18. GM and Ford are canceling some or all of the usual summer break during the weeks of June 29 and July 6 to make up for lost time.
Ford plans to add a third shift to the F-150 line at its Kansas City Assembly Plant on Monday, June 8, according to a Facebook post by Local 249 Chairman Jim Fisher.
As of last week, a spokeswoman couldn't say when the company's Dearborn Truck Plant in Michigan would return to three shifts. FCA has progressively increased production at its three Ram pickup assembly plants.
A lack of trucks on dealership lots is a serious problem, but likely a short-term one, said Mark Wakefield, head of automotive practice at AlixPartners. "It feels like a crisis to a dealer. He feels like he doesn't have the right truck for that buyer," Wakefield said, adding that low supply will have an impact in the second quarter but be more muted in the third and gone by the fourth.
Still, the pandemic could have lingering effects beyond any inventory shortage, Texas dealer Varela said, noting the still-high U.S. unemployment rate.
"If people are not going back to work, what's going to happen?" he said. "We may end up with the inventory but no customers."
Hannah Lutz, Vince Bond Jr., Michael Martinez and Krystal Hur contributed to this report.