By Peter M. DeLorenzo
Detroit. What used to be known as the “What have you done for me lately?” sobriquet in this business – and in contemporary life – has now transitioned to the more immediate “Everything all the time!” mantra. But even that fails to capture what is going on right now.
Right now, as in how much can we cram as into the moment as possible? And then, go ahead and triple that. Learning from the past and gaining perspective from that in order to make better decisions? That’s dismissed as being quaint or out of touch. Yet people are launched into the system without perspective or an understanding of the fundamentals. Mentorship has gone by the wayside in basically everything, and people and projects are left floundering, while expectations remain urgent. 
The seemingly endless limbo fueled by scarcity and shortages, which has allowed manufacturers and their dealers to register huge profits and record transaction numbers is about to come to a screeching halt. Why? The inventories are creeping up, and the lots are filling up with cars and trucks. The stone-faced, “take it or leave it” attitude haughtily displayed by dealers, complete with payments that are $200-$500 more than they were less than twelve months ago is about to go poof. 
Dealers have been quick to point to the rise in interest rates, parts shortages and lack of vehicles to sell as as the primary reasons for the higher payments, and yes, all of those factors have contributed to the mess consumers find themselves in. But that’s conveniently glossing over the one factor that is ever-present: greed. Who’s kidding whom here? Left to their own devices, dealers are going to dealer. Maximize the money. Crank out the cash flow. Bask in the glory of record monthlies. It’s all good. Until it isn’t.
In case the dealers out there are firing up their email machines, I have absolutely nothing against making a buck, that is the name of the game, after all. But what has been going on has been borderline usurious. (Look it up. -WG.) The fact of the matter is that dealers and some people toiling away at the manufacturers don’t know when to quit. They live a life metered out in 30-day increments, even if they vehemently deny that is not the case in this new era of “enlightenment” in the auto industry. But that is the crushing reality. 
How do I know that they do not know when to quit? The dealer mentality revolves around the fact that you’re graded on the sales for the month, as in, “What have you done for me lately?” But as I pointed out earlier, that has given way to “What are you doing right now?” And what are the manufacturers’ financial arms doing right now? They’re unleashing a fresh round of 84-month financing into the waters, as in, “let’s extract as much cash as we can out of consumers before this thing blows up real good.” 
I’ve said it at least a hundred times before in this column, but I consider 84-month financing to be borderline criminal behavior. Knowingly signing up consumers to a loan that maybe one percent of the participants will actually stick with until term is usurious. People are being enticed to enter into a contract that puts them upside down to the tune of thousands of dollars before they even leave the dealership, with no hope of ever recovering from it. As in none. And then two, three or four years down the road when they’re itching to get something new, these same consumers are forced to make up the difference to the tune of thousands of dollars still, or, even worse, rolling that considerable difference into their new payment.
The auto manufacturers and their dealers know this behavior isn’t sustainable, which is why you’re starting to see 84-month financing being pushed in dealer TV commercials and online. Because they know that the current “take it or leave it” strong-arm bubble is about to burst. Inventories are creeping up, and you can bet that by the end of February, incentives will wash over this business like a torrent, and all of the people who were forced to – or who thought they were forced to – sign up for those egregious 84-month loans will be crying the blues for years to come.
I get this right now mantra, I really do. We’re living in a world of immediacy never experienced before, in everything we see, hear, feel and come in contact with. It has blown way past everything all the time. Now, it’s a drowning pool of sensory overload that we can barely keep up with. 
But that’s not an excuse for the shortsightedness being displayed by the auto manufacturers’ financial arms and their participating dealers. That’s not an excuse for untoward behavior and using people just because they can. It’s exploitation in its most basic form, and it’s embarrassing and flat-out inexcusable.
I’m sorry to say that right now, this business is ugly. 
And that’s the High-Octane Truth for this week.

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