Because we already counted it as sold!
When your next raise is predicated on the stock price going up, you'll do anything to make the stock price go up.
A small footnote in the news, BMW is under investigation for registering "loaner" cars and calling them "sales" in order to gin-up the sales numbers to make the company appear to be more profitable. Perhaps it is a small thing, but a telling one.
It seems every day we are treated to another story about how such-and-such a company (usually one of these tech-that-are-not-tech companies) is "restating earnings" or that people are fired for publishing misleading annual reports.
"Fake it 'til you make it" was the mantra in Silicon Valley, but it seems that many of these companies are running out of fake. Some have tried to invent new metrics, as I noted before, going beyond even the specious "EBITDA" (or "Earnings if we didn't have to pay anybody what we owed them!").
It seems like a small thing - a trivial thing - at first. But then you realize that this is a sign of the end times - a sign of a market that is cooling off. When things are going gangbusters, no one needs to "tweak" the numbers to show a profit. No one has to count cars as "sold" that are still on dealer lots. No one has to invent new metrics or make up fake numbers out of thin air.
But in a rising market, it is harder and harder to show increasing profits over time. Eventually, something has to give, if not in fact just level off. But when your whole business model - particularly your personal financial life - is predicated on ever-increasing profits over time, then you are backed into a corner.
Perhaps it is a small thing. But it seems like a data point in a line. I drive by the "sales bank" lot here in Brunswick, GA, overflowing with Dodge Ram trucks and Jeeps - and nary a one seems to have moved off the lot. Meanwhile, FCA is reporting that they have worked down their excess inventory by forcing cars on dealers and not allowing the dealers to order cars they actually want.
It is funny, but in the past, there have been click-bait "sponsored content" links on pages that claim that cars remain "unsold" for months and are sold for pennies-on-the-dollar. Worse yet, some conspiracy-theory websites shows pictures of auto marshaling yards (such as we have here in spades) with thousands of cars in them, claiming that these are "unsold cars" that manufacturers build and then crush for no particular reason (because, you know, that's how you make a profit, by crushing brand-new cars!).
These are idiotic conspiracy theories and click-bait articles. Yet, a young man at a campground asked me about this, in all seriousness, convinced that he could buy a leviathan SUV that "was going to be crushed anyway" if only he had the secret in-the-know information on how to obtain it (and I am sure someone is selling this online, too). There are cars and trucks that are destroyed intentionally, of course - test mules, flood-damaged cars, and whatnot. Right now, we have several hundred sitting in a half-sunken car carrier that will be cut up and destroyed. They've been sitting immersed in salt water for a couple of months, now, what could possibly be wrong with them?
These surplus Dodges ("Rams") and Jeeps will, of course, be sold. No one gives away cars or crushes them for no reason. When Audi had the TT disaster (one of the early cars went airborne and killed a famous rally driver, due to its abysmal aerodynamics) sales plummeted. Audi gave dealers cash and told them to move the unsold cars to the used car lot, and cut the prices. Brand-new cars, with ten miles on the odometer, sold as used - so as not to depress prices of the new cars coming off the line. It does happen, but it doesn't mean the cars were free.
I suspect the same will happen with Fiat Chrysler. But whether their sales figures are really accurate remains to be seen. Yes, these "sales bank" cars will be sold, but at a steep discount. Already other car makers are following FCA's "employee pricing" move, which means thinner margins and smaller profits. What does this say about the health of the auto industry or sales in 2020?
It seems there are two markets out there - the real one and the phony one. The real market is based on income of ordinary people, the money they can borrow, and how much they can afford to spend. These are real-world purchases that drive the real economy. The phony market is driven by "news" - the stock market going up or down in response to the latest announcement about "trade deals" or profit statements "beating" expectations, even if the numbers themselves are somewhat suspect.
I guess we'll see how far apart these two markets can spread before some sort of reconciliation occurs.
