The auto market “is crazy”: dealers cannot keep up with demand


Some customers have been reluctant to pay full price for new cars and have chosen to settle for older vehicles. This has increased the demand for parts and services, one of the most profitable businesses for car dealers. Many dealers have extended the hours of operation of repair shops. Mr. Ricart said he had repair technicians who worked 10- or 12-hour days three or four days in a row before taking a few days off.

Of course, the car shortage will end, but it’s unclear when.

As Covid-19 cases and deaths increased last spring, automakers closed factories in North America from late March to mid-May. As their factories were down and they expected sales to pick up slowly, they ordered less semiconductors, the tiny brains that control engines, transmissions, touch screens, and many other components of the modern cars and trucks.

At the same time, consumers confined to their homes have started purchasing laptops, smartphones and game consoles, which has increased demand for chips from the companies that make these devices. When automakers restarted their factories, fewer chips were available.

Many automakers have had to idle their factories for a week or two at a time during the first half of 2021. GM, Ford Motor and others have also resorted to producing vehicles without certain components and their storage in factories until the arrival of the required parts. At one point, GM had around 20,000 nearly complete vehicles waiting for electronic components. He started shipping them in June.

Ford has been hit harder than many other automakers due to a fire at one of its suppliers’ factories in Japan. At the end of June, Ford had about 162,000 vehicles at dealerships, less than half the number there were just three months ago and about a quarter of the stock that its dealers typically hold.

This month, Ford is slowing production at several North American factories due to chip shortages. The company said it plans to focus on completing the vehicles.

Mr. Ricart recently took a trip on his Harley-Davidson to Louisville, Ky., And took a look at trucks and SUVs at a Ford plant waiting to be completed. He said he saw “thousands of trucks in fields with temporary fences around them”.


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