Now there are higher prices for base materials such as steel and aluminum. There are suppliers being forced to raise wages quickly to keep the assembly line running. There are semiconductor manufacturers being too long-winded to supply enough computer chips to produce as many cars as consumers want to buy. There is also a shortage of resins that are needed in the plastics that are part of the car. which was caused by a winter storm in Texas this year. and moreover It also has a jam-lock of delivery capabilities for materials imported from abroad.
“It’s almost like a patient who is battling cancer, heart disease and diabetes at the same time,”; Burris said. The power that automakers often hold to stop suppliers from raising prices is collapsing, he said, amid the urgency to procure supplies.
And as automakers speed up production There has been an unusual shift in the retail aspect of the market.
Ivan Drury, senior manager of insights at auto industry publisher Edmunds, said automakers can’t produce at full speed. This coupled with strong consumer demand is evident. In the past, the “manufacturer suggested retail price” was generally just a suggestion. Dealers are negotiating actual selling prices of $2,000 to $3,000, well below that level for conventional cars. Currently, new cars are usually sold at suggested retail prices or only slightly lower, he said.
And dealers turned to other techniques. limited sales with less inventory Buyers looking for a particularly coveted vehicle may need to buy it before it hits the lot without being seen. He said some dealers would refuse to sell to people from outside the dealership area. This ensures that buyers will continue to generate revenue from the service.
Things are even worse in the used car market, where the last 16 months of the rental car industry among other factors It has caused severe shortages and dramatically higher prices. Used cars and trucks were the main cause of overall consumer price inflation in April and May.
Drury doesn’t think that will change anytime soon. According to Edmunds, the average car trade-in value continued to rise for the first three weeks of June, up 2.9 percent after rising 21% in April and May.