Dealerships and car manufacturers are both having a hard time keeping up with the high demand for vehicles, either new or used inventory.
The automotive industry didn’t expect the economy to open up quite so fast. Also, the effect of the COVID-19 pandemic is still being felt by the industry due to the global microchip shortage. These chips are needed in car manufacturing, but because of the high demand for chips in laptops and other electronic gadgets, the shortage may last into next year.
Experts say that car inventory may be 1.2 million fewer vehicles than usual this year, according to NBC News. Car shoppers may turn to used cars, but the high demand has affected the supply of used cars as well.
“For a lot of people, that does mean big purchases. A lot of people are moving or traveling -- or they’re buying cars,” Emilie Voss, Public Relations Director at CARFAX, told NBC News. “We are seeing a severe lack of inventory in the used car market. Dealers can’t stock their lots fast enough. The consumer demand is huge.”
Adding to the tight inventory this year is the fact that rental car companies are now trying replenish their supply. They are replacing the cars they sold early in the pandemic to meet current travel demand.
Average retail prices are up from $18,570 in May 2020 to $24,290 in May 2021, CARFAX data shows. Average list prices are up 25%, and truck prices are up by 44%.
Alerts Sign-up