Real estate growth industry: Store thousands of unsold cars on your vacant land

There's a giant pile-up down at the Port of Los Angeles. No, not the usual oops between an 18-wheeler and a passenger car on the 710 corridor. It's a pile-up of unsold vehicles.

Thousands of unsold import cars -- everything from SUVs to hybrids, are sitting idle, waiting for dealerships across the country to sell their backlog and replenish. Trouble is, in the worst car market in a generation, nothing's selling. So the car companies have leased vacant land at the Port of Los Angeles (the biggest port in the country) for use as a massive parking lot.

Now it's running out of space. Toyota and Mercedes have quickly leased more acreage, but Nissan couldn't arrange it and had to find parking lot space elsewhere.

Los Angeles Auto Show

    ** FILE ** In this Nov. 28, 2006 file photo, golfer Tiger Woods helps to introduce the 2008 Buick Enclave to the media at the Los Angeles Auto Show in Pasadena, Calif. General Motors Corp. says it will end its endorsement deal with Tiger Woods at the end of the year. GM said in a statement Monday Nov. 24, 2008 that it is looking to reduce costs, and that the star golfer also wants more personal time as he expects his second child. (AP Photo/Chris Carlson, file)

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    ** FILE ** In this Nov. 28, 2006 file photo, Chairman and CEO of General Motors Rick Wagoner, left, and PGA golfer Tiger Woods introduce the 2008 Buick Enclave at the Los Angeles Auto Show in Pasadena, Calif. General Motors Corp. says it will end its endorsement deal with Tiger Woods at the end of the year. GM said in a statement Monday Nov. 24, 2008 that it is looking to reduce costs, and that the star golfer also wants more personal time as he expects his second child. (AP Photo/Chris Carlson, File)

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    Consumers play race cars at the Ford Fusion Challenge stand at the Los Angeles Auto Show in Los Angeles on Friday, Nov. 21, 2008. The crowds at the show are a reluctant bunch this year. Anxious about the economy, the future of the Detroit Three automakers and the unpredictability of gas prices, few said they had any intention of buying a new car anytime soon. (AP Photo/Damian Dovarganes)

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    Brandon James 2, from Long Beach Calif. gets behind the wheel of the Cadillac XLR convertible with his aunt Sue Burkitt, at the Los Angeles Auto Show in Los Angeles on Friday, Nov. 21, 2008. The crowds at the show are a reluctant bunch this year. Anxious about the economy, the future of the Detroit Three automakers and the unpredictability of gas prices, few said they had any intention of buying a new car anytime soon. (AP Photo/Damian Dovarganes)

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    Consumers interact with video consoles next to the newly introduced 2009 Volvo XC 60, displayed at the Los Angeles Auto Show in Los Angeles on Friday, Nov. 21, 2008. The crowds at the show are a reluctant bunch this year. Anxious about the economy, the future of the Detroit Three automakers and the unpredictability of gas prices, few said they had any intention of buying a new car anytime soon. (AP Photo/Damian Dovarganes)

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    Car fan Clay Waters, 12, originally from Montgomery, Ala., gets behind the wheel of a Smart 2009 Passion Cabriolet at the Los Angeles Auto Show in Los Angeles on Friday, Nov. 21, 2008. The crowds at the show are a reluctant bunch this year. Anxious about the economy, the future of the Detroit Three automakers and the unpredictability of gas prices, few said they had any intention of buying a new car anytime soon. (AP Photo/Damian Dovarganes)

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    The bottom of a Ford Mustang 2009 is displayed to consumers at the Los Angeles Auto Show in Los Angeles on Friday, Nov. 21, 2008. The crowds at the show are a reluctant bunch this year. Anxious about the economy, the future of the Detroit Three automakers and the unpredictability of gas prices, few said they had any intention of buying a new car anytime soon. (AP Photo/Damian Dovarganes)

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    Ron Myers, 65, comments on his lifetime ownership of American made trucks at the Los Angeles Auto Show in Los Angeles on Friday, Nov. 21, 2008. A new concept electric Chrysler LCC Jeep EV is seen behind. The crowds at the show are a reluctant bunch this year. Anxious about the economy, the future of the Detroit Three automakers and the unpredictability of gas prices, few said they had any intention of buying a new car anytime soon. (AP Photo/Damian Dovarganes)

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    A consumer walks through a cutaway 2008 Ford Taurus crash car displayed at the Los Angeles Auto Show in Los Angeles on Friday, Nov. 21, 2008. The crowds at the show are a reluctant bunch this year. Anxious about the economy, the future of the Detroit Three automakers and the unpredictability of gas prices, few said they had any intention of buying a new car anytime soon. (AP Photo/Damian Dovarganes)

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    The new Lamborghini Murcielago LP 640 Coupe, a permanent 4-wheel drive 6.5L Engine/12 cylinder supercar, is seen at the Los Angeles Auto Show in Los Angeles on Friday, Nov. 21, 2008.(AP Photo/Damian Dovarganes)

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"It's unusual that they [surplus cars] would be here longer than a few days, but that's the situation now," a spokesman for the port told Reuters. "They can't move it through their pipeline fast enough so they are asking for additional space while they keep their vehicles here more than a few days, and in some cases more than a few weeks."

On Friday Toyota announced that it was idling factories to cut its North American output. Its inventory is currently at "unacceptably high" levels that would take 80 to 90 days of sales to clear, according to a Reuters report.
Sounds ugly. But almost doable, compared to the 115-day supply of inventory on average for GM, Ford and Chrysler. Good thing the Midwest has lots of open land to park those unsold cars on.

With the financial crisis worsening, It doesn't sound like car sales are going to be improving any time soon. And until production winds down, there will be a lot more surplus piling up at the ports of entry.

Meanwhile, back on the West Coast, I sniff a growth business. Landlords with large, vacant tracts can lease out their land to the car companies for the big bucks. I know the City of Long Beach has tracts of unused (and highly polluted) industrial land just sitting idle. I also know it's facing a huge budget deficit. Hello? Creative ancillary revenue streams? Hey, any port in a storm, right?

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