Unprecedented shortage of new cars a challenge for Bakersfield auto dealers, customers | News – Bakersfield, California

Bakersfield, California 2021-06-05 19:42:00 –

Parking for some cars in Bakersfield looks really desolate, as the global shortage of new cars is having a similar impact on local dealers and customers.

As microprocessors are under pressure around the world and hundreds of microprocessors are used in new cars, the 2021 model is delayed in shipment and availability in Kern County and across the country. And that’s causing a surge in used car sales, which is causing upward pressure on prices overall.

“Currently, a total of 50 new Chevrolets and Cadillacs are on the ground,” said Ted Nicholas, president and dealer operator of the Bakersfield Auto Mall Three-Way Chevrolet Cadillac.

Fifty may sound like a lot, but Nicholas said dealers could sometimes boast of 800 new cars.

“I think we’re bottoming out,” Nicholas said of the low inventory. “It will be a little better next month and will continue to improve.”

But the cause of the chip shortage isn’t immediately resolved, he said.

“Only 12% of chips are manufactured in the United States,” he said. Most of the remaining 88% are made in the Far East, including China and Japan.

“This chip crisis will continue until 2022,” he said.

At Jim Burke Ford Lincoln, the only car in the showroom on Thursday was the 2020 Cobra GT 500. Beautiful, but not very new. There were several 2021 models on display outside. However, the picking looked slim.

“You’re wondering why there’s a vacant lot,” said Jim Burke President Joe Hay. “It’s a really unusual time in the industry.”

As with what happened in the last year and a half, the root of the problem began with the coronavirus.

Early in the pandemic, car purchases plummeted, car rental companies canceled fleet orders, Nicholas said, and automakers canceled chip orders. But then there was a big recovery in demand — when semiconductors were out of the pipeline.

“Last year was a good year,” said Nicholas of Three Way. “But in the first five months of this year, it’s up 30% from last year.”

Motor City Buick GMC Chief Operating Officer John Pitre said he can remember when demand temporarily exceeded supply, but he doesn’t remember how serious it was.

There are about 100 new cars “on the ground” in Motor City, Pitre said. Over 1,000 have come and “some have been built and some are waiting to be built.”

About 500 new cars are available on the website, including 100 lots.

“We are all facing the same problem,” Pitre said of Motorcity and its competitors. “The market is bigger than the supply”

For local car buyers, these powerful market forces can turn buying and selling into difficulties or benefits.

Local teacher Rachel Renix said her daughter started shopping for cars late last year. She deposited a deposit on a car that hadn’t been manufactured yet because the desired color wasn’t available in lots.

“She was told that the car would be delivered in February,” Renix said. “It was said that February was March, March was May, and in some cases June. Now it’s June and we’re still waiting.

“The worst thing is that she traded in the lease on the assumption that the car will be completed in February, so I don’t have a car right now.”

In fact, some car companies have been forced to shut down, some new car prices have skyrocketed, and used car demand (and costs) has skyrocketed.

Chris Cruz Boone, who lives in Bakersfield, said he went to Arizona with his husband and got the model he wanted.

“Was that, I waited two months for one to arrive.”

“We ended up buying second-hand goods from the dealer,” she said in a text message. “But we actually flew to Phoenix and drove home just to get a car. Did”

Their SUV was stolen earlier this year and needed to be replaced immediately.

“The best deal we could find within 100 miles of Bakersfield was $ 5,000 above the suggested retail price (manufacturer’s suggested retail price) and waiting for the car for two months,” said Cruz Boone. Stated.

On the other hand, consumers appreciate the trade-in price of used cars.

Was this hard for the sales team?

Nicholas said he would not dismiss him. And Pitre said Motor City is actually expanding its sales force.

According to Pitre, fewer customers are coming to the store to “kick the tires”. However, internet shopping does not mean that salespeople are being ignored. On the contrary, Internet sales usually take longer to manage than traditional transactions, he said.

Is the shortage sacrificing dealer sales despite healthy demand?

“There is demand,” Nicholas said, but not the car. “Last month I may have sold another 100.”

Reporter Stephen Mayer can be contacted at 661-395-7353. Follow him on Facebook and Twitter: @semayerTBC.

Unprecedented shortage of new cars a challenge for Bakersfield auto dealers, customers | News Source link Unprecedented shortage of new cars a challenge for Bakersfield auto dealers, customers | News

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