The shortage of new cars that has been raging for several years now shows no signs of abating. Here's a look at a situation that calls for patience.
1 - What has caused this shortage of new cars?
Several factors seem to have contributed to reducing the availability of new vehicles in stock. A perfect storm, so to speak. First, the supply chain was disrupted by the COVID-19 pandemic. Several automakers and auto parts suppliers decided to slow down or temporarily halt production to limit the spread of the virus.
The global shortage of semiconductors used to make microchips and certain automotive parts compounded the problem. And that's not to mention the labour problems (shortage of skilled workers, rising absenteeism, etc.) that are also affecting the operations of several industries.
So we are helplessly witnessing an imbalance between limited supply and robust demand. Manufacturers have a production backlog (and many challenges to overcome), while consumers are clamouring for new vehicles.
2 - What is the situation on the ground?
The production backlog that automakers have accumulated since 2020 is difficult to make up. Waiting times for desirable vehicles could last until mid-2024. Others expect a gradual return to normalcy by 2025. On the other hand, some headlines in the news suggest that rising inventories at some dealerships is an encouraging sign.
But beware! Dealers could get used to driving with fewer new cars in stock. They might shift into fifth gear to ensure just-in-time deliveries. Less inventory often means lower inventory costs. This gives them more power to sell at full price with no real bargaining power for buyers. Buyers line up in the hope of getting the model they want, and they're willing to give it their all!
Potential buyers often join several waiting lists at once. They then drop out when they get one of the cars they want. So it's hard to predict delivery times. In any case, if you're in the process of buying a new car, in most cases you'll have to wait behind the wheel of your old one for several weeks, if not months, after the deal is signed.
3 - Is there the same shortage for electric cars?
Yes, because of the many advantages they offer, electric vehicles (EVs) are really catching on. Consumers want to go electric to save on gasoline costs. Others fear that generous government subsidies for vehicle purchases will be cut off in an uncertain economic climate.
The lack of new electric vehicles on the market sometimes discourages potential buyers from moving forward with their purchase plans. However, a survey conducted by Équiterre in December 2022 shows that the waiting time for the delivery of an EV is not as bad as you might think...
Since April 2021, 55% of new EV buyers have been able to take possession of their vehicle in less than six months. And 30% waited between six months and a year. And wait times are shorter or even non-existent for drivers who prefer a used EV.
New Vehicles: Your Patience Will Be Rewarded
It won't be long before you can get behind the wheel of your new purchase. In the meantime, patience is key. But in the meantime, can you do everything in your power to be ready for the big day? For example, if you're waiting for a new electric vehicle to arrive, find out how to buy and install a home charging station.
Get some auto insurance quotes online to find the best coverage for your needs at the best possible price. Evaluate different scenarios, such as increasing your deductible to get a lower premium. Take the opportunity to combine your home and auto insurance under the same policy. Here's your chance to save even more!
