SHOPSMART AUTOS – CUSTOMER INFORMATION – NOVEMBER 1, 2021
Global Chip Shortage Makes It Tough to Buy Certain Cars
The global semiconductor shortage continues to squeeze the supply of microchips used to manufacture everything from cars to robotic vacuum cleaners, and it’s wreaking havoc on the auto industry. Almost every manufacturer has faced production delays and temporary shutdowns as they wait for the chips they need to finish building cars on the assembly line, with the latest a gloomy announcement from Cadillac that it would temporarily suspend the Super Cruise driver assistance and monitoring technology from its Escalade SUVs. Other manufacturers Consumer Reports contacted say they are also either suspending certain optional features or pausing production altogether. Toyota, one of the largest manufacturers in the world, says it is going to build 60,000 to 80,000 fewer vehicles in October. Some analysts predict a production shortfall of almost 8 million vehicles by the end of the year as the chip shortage drags on. An ever-tighter supply of new cars means consumers can expect not to find deals—or even cars, in some cases. “There is very little on dealer lots to actually sell,” says Sam Abuelsamid, an analyst at Guidehouse Insights, which tracks the automotive industry. “If you anticipate needing a new car in the next six months, it’s probably best not to wait. Go ahead and place a factory order now.” Following that advice, he says, your car may arrive just in time. “Odds are there won’t be much to choose from otherwise,” he says. Abuelsamid’s dire forecast echoes comments made by Patrick Gelsinger, CEO of Intel, one of the largest semiconductor manufacturers, at the company’s July earnings webcast. “It will take another one to two years before the industry can catch up with the demand,” he said to investors. Jake Fisher, senior director of Consumer Reports’ Auto Test Center, recommends holding off until the market has shifted in the buyer’s favor. “Now is a terrible time to buy a car, so it’s probably best to avoid it if you can,” he says.
All new cars are built with a plethora of microchips onboard to control everything from window motors to navigation systems, and the auto manufacturing industry has been hard hit as chip shortages have caused production slowdowns. For consumers hungry for new cars, that means fewer are available. Buying a car right now—whether new or used—is more difficult than usual. So you have three choices: Look at models you weren’t previously considering, hold off on buying, or fix your old car if it’s in rough shape.
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