Every manufacturer has an order cut-off date. While they vary for each manufacturer, and the exact dates change annually, they are generally scheduled for sometime in the spring providing business owners and fleet managers with plenty of time to identify their vehicle needs and place their orders. But this year was different. Here’s all you need to know about cut-off dates, why they are there, and what is different about this year.
Why are we seeing Manufacturer Cut Off Dates in December 2020 or January 2021?
COVID-19 has impacted many industries and the automotive industry is no different. In March 2020, many manufacturers closed their US factories not reopening until late April or May 2020. Many did not re-open to full capacity and have been scrambling to make up orders since. Manufacturers are now processing orders placed from September 2020 – February 2021.
January 2021 provided another hurdle for car manufacturers to overcome. As New York Times Reported on January 13, 2021, “Strong demand for gaming systems, personal computers and other electronics by a world stuck indoors has sucked up supplies of semiconductors, forcing carmakers around the world to scramble for the chips that have become as essential to mobility as gasoline or steel.” So in 2021 manufacturers have had to shut production on some vehicles – yet again.
Here is a current list of top manufacturers order cut-off dates:
- GM/Cheverette: The cut-off date for new pick-up truck orders was scheduled for January 21, 2021. “According to our GM representatives, it may consider reopening order banks in July 2021 which would make the timing for delivery of vehicles in the September or October timeframe.” Click Here for GM 2021 Build Out Schedule.
- Ford: Order bank for fleets closed as of January 21, 2021. “They have not provided further information as to the potential resumption of production later in this year.” Click Here for Ford 2021 Build Out Schedule.
- Chrysler/RAM: Currently, the order bank is open. “RAM representatives indicate that orders placed in January are likely to deliver sometime in May, which is subject to change at any time.”
You might be wondering – Why does this matter?
The result of much of this is the manufacturers will prioritize retail (nicely equipped units) over fleet production. Order banks will fill quickly by large fleet orders for the 2022 model trucks when they open. Likely delivery on 2022 fleet orders for latecomers will be 6 + months after production starts. That could very likely mean late in this year or early next year before we see fleet inventories available in any real numbers
If you usually purchase your fleet vehicles from a dealership you might have never considered manufacturer cut-off dates before. You may be able to find a vehicle in a dealer lot, but it will likely be equipped more nicely, which will cost thousands more, than a fleet order. Also, we expect from a supply and demand standpoint, dealerships won’t be motivated to sell those units below MSRP.
2021 might not be the year to purchase new vehicles – Here’s What You Can Do
The key to securing the best deal is by factory ordering a vehicle that is equipped to meet your needs. For this, 2021 might not be the year in which you order a slew of new trucks, but instead might be the year you organize your fleet strategy, prioritize the units that are the riskiest for remarketing, and optimize the operational expense of the fleet so that when order banks re-open, you’ll be ready to advance your strategy.
To begin advancing your strategy we suggest you:
- Put a plan in place to sell the oldest, most risky vehicles (where $1 spent on repairs will NOT increase the value at resale).
- Identify the units you absolutely need in 2021
- Search for wholesale opportunities – even from dealerships
The best way to start is with an Alliance Leasing Fleet Health Assessment. We can then take you through the steps of identifying needs, remarketing, and sourcing wholesale vehicles to meet your immediate needs.