Correct me if I'm wrong, but from my understanding Nintendo will begin a fairly steady release of games for WiiU starting in August.

That's great.

But that's a lot time away and WiiU sales are deterioting every week.  With no notable games being released for months, I don't see any reason why this would change.   Even if they wow us at E3, those games aren't coming for months (or over a year) and there's little reason to go out and buy a WiiU now.

Retailers will not sit on slow moving stock forever.  They'll want to use the space for something that will bring in more revenue, now, today.

Will they hold out until Sept in hopes of better sales?   I'm getting rather concerned that by then they may all be in clearance mode making room for PS4/Xbox One.   Thoughts?

It's unfortunate for those of us who bought a Wii U already and have had these months of game drought, but it's unlikely to affect retailers much. Nintendo and other publishers and manufacturers PAY for the space they use in each retail location, and so regardless of whether it's selling well or not, the retailers are charging Nintendo for every square foot of space they "rent" for their products to be displayed. Certain retailers will take their own markdowns on products in order to clear out warehouses and back-room stock, but that's their own decision, and again, it wouldn't affect the actual shelf space that Nintendo is paying for to use.

Well, it kind of does make sense if they intend to gather their resources and relaunch the console in every way possible, including a new advertising strategy and focus. That needs to be done in conjunction with games that will turn heads. At this point, I think a relaunch is better than a slow trickle of games, which would do very little to change the instilled mindset that the Wii U has nothing to play.

If Nintendo wants to turn things around then they're really going to have to go all-out. This fall season might be do-or-die for the Wii U.

I'd never heard of such a thing, but to an extent, you may be right.  I do see retailers shrinking and shuffling brand space around based on sales all the time though.  So maybe it's more of a relegated to the back corner (instead of out front) than a taken completely off the shelves thing.

Its possible tho that after E3 it will get a boost, people will see whats coming and get excited and who knows, X1/PS4 could disapoint at E3 making Wii U a more viable purchase. I think sales will remain in the 25-30k per week range til aaugust when it high profile games start releasing, price cut and new marketing campaign hit. That will build momentum going into the holidays where its sure to sell well.

Wouldn't leaving the Wii U out on one-leg (so to say) also be a bad decision? As of now, it's just a money magnet for them.

As I said in the global up thread this week: no, it seems like they can't really afford to, because it's getting to bloodbath-levels of low. 

I know this seems a bit silly, but I really didn't realise just how bad Wii-U sales are at the moment until looking through them all since launch and noticing that week after week they're getting to some kind of record low.

But, there's nothing Nintendo can do about it for the time being.  Games will come when they're finished.  And I don't doubt that in the USA & Japan at the very least, these games will do something to help.

The problem is that the games which are really going to help aren't the August/September games.  We saw Lego City & Monster Hunter give a decent boost, but the console frittered away back to nothing soon after.  Pikmin & W101 will probably have a similar effect.  A short term help, but not a long term solution.  Mario Kart is a more long term solution and we don't know when that's coming, but hopefully in the holidays if at least 3D Mario & Zeldaremake come out, that should be "enough".  

Sure, and it's unfortunate that those most affected are probably Nintendo's most loyal fans, but they've got to try to change people's minds about the Wii U while they still can, before it gets the "failure" label among the general public.

The Wii U is wounded; they can keep putting bandaids over the wound, which is probably ultimately futile, or they can go ahead with a risky operation that might turn things around.  

Now, had they been releasing games all along, that would be another matter entirely.  I believe they screwed up big time by not throwing out everything they could BEFORE the PS4/XO hype started.  They should have loaded the beginning of this year with games and worked on building an installed base and establishing positive buzz about the console.  It's too late for that now, though.

They can't but they will.

If the games are not ready, then, there is not any option, is it? I don´t think Nintendo is keeping any finished products in their stock.
But, I agree, this lack of releases is really hurting the WiiU sales. The last game I felt any interest was ZOMBIU....