Why do you think there is a huge supply of engines? Manufacturers these days employ something called lean manufacturing where their suppliers only provide what is needed when they need it to avoid unnecessary inventory. Also, the LS7 is hand built so there isn't some huge automated line pumping these out.

 

I dont think there is a huge supply of engines, but as a crate motor the LS7 is pricey plus sticking it in a Camaro is a sure fire way to move them out the door as an SE and turn a good profit.

With the C7 arriving here shortly, I think the LS7's tour of duty is done for that car.