A May 2014 report claims that millions of new cars are being left to deteriorate unsold and unmaintained in vast car yards all around the world because the world recession is ‘still biting’. The report features a series of photographs depicting the car stockpiles.
The report is misleading. Many of the images in the report are from 2009 and depict cars stockpiled due to dramatic falls in sales caused by the Global Financial Crisis (GFC). Since then, new car sales have rallied considerably. Moreover, some images that purportedly depict stockpiles of ‘unsold’ cars simply show stored cars awaiting shipment at port facilities. Thus, despite the claims in the report, the images do not provide evidence that millions of cars are left to ‘die’ unsold or that the GFC continues to severely impact new car sales.
Where the World’s Unsold Cars Go To Die
There are hundreds of places like this in the world today and they keep on piling up…
THE WORLDS UNSOLD CAR STOCKPILE
Houston…We have a problem!…Nobody is buying brand new cars anymore! Well they are, but not on the scale they once were. Millions of brand new unsold cars are just sitting redundant on runways and car parks around the world. There, they stay, slowly deteriorating without being maintained.
According to a report published on news blog Zero Hedge, millions of new cars are being stockpiled in vast parking lots all around the world because they cannot be sold due to the continuing effects of the Global Financial Crisis (GFC). As evidence, the report features a series of aerial photographs depicting large numbers of parked vehicles in various facilities.
The report notes:
Millions of brand new unsold cars are just sitting redundant on runways and car parks around the world. There, they stay, slowly deteriorating without being maintained.
The report maintains that the images ‘provide proof that the worlds (sic) recession is still biting and wont ( sic) let go‘.
But, in fact, the report is misleading and inaccurate.
Many of the images used in the report were first published back in 2009 or earlier. A lot of the images do depict cars stockpiled after the meltdown in new cars sales generated by the GFC, but they have no relevance to the current economic landscape for car sales.
The first picture in the report is taken from a 2009 news article about sales figures for a car dealer network in Atlanta. The second image is taken from another 2009 report about the effect of the GFC on car sales. Other images are taken from yet another 2009 article about cars stored at the Nissan test track in the UK and in Spain.
The image showing vehicles on a disused Russian runaway is also from 2009.
Another image in the sequence shows cars ready for shipment at Port of Yokohama on December 4, 2008.
The final image in the report shows vehicles stored at an airfield as part of the UK governments scrappage scheme, which wrapped up in 2010. However, the cars in the image are not even new. The scrappage scheme was designed to encourage UK citizens to purchase a new car or van and scrap an old one that they had owned for more than 12 months. A 2010 news report about the scheme explained:
Motorists who trade in their old cars can get a £2,000 discount towards a new vehicle under a ‘bangers-for-cash’ scheme designed to kickstart the ailing UK motor industry, after an announcement in the 2009 Budget.
The scheme began on 18 May 2009 and will run until 28th February 2010, or Government cash runs out.
A few of the images used in the report simply show cars awaiting shipment or delivery at ports or similar facilities. For example, some images in the report are described as depicting thousands of unsold cars at Royal Portbury Docks, near Bristol in the UK. However, the cars have not been left to ‘die’ unsold at the facility as suggested in the report. In fact, the cars are simply stored there while they await shipping or delivery to various locations.
The Bristol Port Company website notes that the port can handle up to 700,000 motor vehicles a year and is ideally located for cost-effective distribution throughout the UK. It also notes that ‘vehicles can be stored on the extensive paved quay areas and delivered to and from the adjacent storage compounds without travelling on public roads’.
Other ports, railway yards, and transportation facilities around the world offer similar storage capabilities for new vehicles in transit. At any one time, large numbers of vehicles are likely to be stored at such facilities awaiting the next leg of their journeys to sales outlets and customers.
Obviously, car manufacturers do not build each new car after a customer has ordered it. Instead, they manufacture new cars based on predicted demand over a given period. If there is an unexpected slump in demand – even a short-term one – unsold cars may accumulate and – of course – they have to be stored somewhere. But, this does not mean that the cars will never be sold or that they will simply be left to rot in ever-growing stockpiles as suggested in the report.
Moreover, if there is a significant or prolonged downturn, car manufacturers respond by slowing or even temporarily shutting down production. They do not simply continue to churn out unwanted vehicles and leave them to rust away in giant car parks.
Despite the claims in the report, new car sales have recovered considerably since the dark days of the GFC. In fact, in 2013, the UK recorded its best sales year for new cars since 2007. And, while sales figures in the rest of Europe and elsewhere are less rosy, there is no evidence to support the claims that vast dumping grounds of new cars are springing up all over the world.
Thus, the report is outdated, inaccurate, and misleading and its claims lack credibility.