Why Are New Vehicles Not Being Delivered?

A new concern in the automotive industry has risen regarding the delivery of new vehicles. More specifically, the lack of it happening. Reports indicate fewer cars are being delivered to consumers.

Automakers may also be facing difficulty finding enough customers to purchase their products in a saturated market.

The global pandemic's repercussions have caused many supply chain issues. These problems have rippled into production delays and other contributing factors, such as a global chip shortage.

Those experiencing delays in receiving their new vehicles may find understanding the challenges the automotive industry is currently facing useful.

The Global Chip Shortage

The chip shortage has been a major hurdle in producing new cars, trucks, and SUVs. Many automakers have had to limit or halt production altogether to conserve their remaining chips for essential items.

The issue has been further compounded by other disruptions caused by the Covid-19 pandemic and its impact on the entire industry.

As such, buyers could experience a different outcome than what they had anticipated when it comes to their new car.

Why Is There A Global Car Chip Shortage

The car chip shortage is partly caused by auto manufacturers who canceled their semiconductor orders in the early stages of the coronavirus pandemic.

This dramatic shift in consumer behavior meant a sudden decreased demand for cars, leading to producers drastically reducing their semiconductor orders.

Unfortunately, once the economy started to improve and new car orders came back in, accessing these materials proved extremely difficult.

This is because many of those semiconductor suppliers already had the components assigned to overseas producers of consumer electronics, such as phones and laptops.

Because these devices are smaller and more commonly used than cars, manufacturers naturally prioritized them ahead of automotive materials when it came to available chips. Hence, many automakers struggle with shortages and postpone production due to a lack of required parts.

With no immediate solution yet, many carmakers have been forced into damages from increased delays in production lead times.

Solutions like looking for alternative suppliers or creating manufacturing partnerships have helped some companies, but this chip shortage continues to be a major problem for most.

When Will the Chip Shortage End?

The global car chip shortage has had a dramatic and far-reaching impact on the auto industry. The Covid-19 pandemic created major production disruptions, and chip inventories have plummeted to just five days worth compared to forty days of supply pre-pandemic.

Market analysts predict supplies may take two years at minimum to return to their normal state before the pandemic.

Another issue is that many chip suppliers exist outside the US, making it difficult for domestic producers to meet rising demand. President Joe Biden signed House Resolution 4346 into law to address this issue on August 9th, 2022.

This bill will fund domestic research and production to the value of $54.2 billion—one of the largest investments being made to address this problem.

With support from government incentives and increased domestic production, there is hope that this chip shortage will end sooner rather than later.

What Car Brands Are Hardest to Find?

The global chip shortage has made it difficult to find certain models of cars. Import brands such as Kia and Honda have been hit hardest by the shortage, with a 17 days supply versus the industry average of 33. Toyota and Subaru are not faring much better at 19 and 20 days supply, respectively.

That said, even higher days' supply numbers of other brands may still leave you without the car you want. For example, GM currently has more inventory than Toyota, but many of their models come in several different configurations.

It could be hard to look for just one specific truck or sports car variant. It might require ordering from a dealer or waiting for it to arrive at the lot. Thus, even higher days' supplies do not necessarily mean an easier time finding a car during this chip shortage climate.

How Has This Affected Car Prices?

The car market is experiencing tough times due to the chip shortage. Paying above the manufacturer's suggested retail price, or MSRP, is to be expected of new car buyers. According to Kelley Blue Book, prices for new cars have been steadily rising for months.

The forecasted average transaction price of a new vehicle in October 2022 is projected by JD Power to be $45,599, with a monthly payment of $711. This situation worsened as SUVs and trucks have seen increased prices due to the limited availability of chips.

The chip shortage means that while there are still cheap cars available in 2022, the selection is small compared to what it would be under normal circumstances—for potential car buyers during this era, researching and shipping around for options become a must.

It could also be beneficial to postpone buying a car until the chip situation improves and more vehicles become available at more reasonable prices.

How Has This Affected Car Sales?

The global auto industry was dealt a double blow in 2022, with the previously challenging chip shortage further compounded by the emergence of higher interest rates at the same time.

This higher rate drove sales to their lowest level in a decade, as supply chain chaos limited production, preventing manufacturers from providing enough cars and trucks to meet consumer demand.

The global chip shortage has now eased a little, allowing automakers to increase and expand their production, but higher interest rates are still putting off potential buyers.

This situation could still delay the auto market's recovery, with no clear indication of when we can expect a return to normal levels.

What Else Can Cause New Car Delays?

The recent global computer chip shortage has caused the most severe disruption in the automobile industry, resulting in delays of up to six months in delivering new cars. However, other reasons can cause delays as well.

Additionally, with sales drastically lower last year, there is a shortage of nearly-new cars, with many buyers opting for secondhand models instead. Even in more stable times, there can be hidden delays when receiving a new vehicle.

Manufacturers may underestimate the demand for a car. They may end up having to prioritize orders further down the line. And there's always the potential human error risk that could throw a wrench into the mix.

One such instance is customers reporting that they thought their new cars were on their way, only to discover that the dealer never placed an order in the first place.

Due to these factors, receiving one's new car can be unpredictable and potentially take longer than expected, even outside current "unprecedented" circumstances.

How to Deal With New Car Delays

We understand how off-putting it is to wait for a new car. Feeling anxious from the uncertainty of when your vehicle will arrive is normal. But you can take control of the situation by staying in touch with the delivery center, dealer, or manufacturer.

Before getting too frustrated, contact the customer service team at the destination to double-check what could be causing the delay. They may be able to offer a more detailed explanation than simply, "There has been a logistical issue."

Another strategy is to review previous communications with them and ensure all documents have been signed off and sent on time; these steps are often easy to overlook but can impact deliveries. Keep notes of every conversation and try to get the names of people who spoke to you.

This measure can help if you need to escalate any issues, such as speaking directly with higher-level staff or escalating it via customer services teams.

What's more, don't be afraid to ask questions—naturally, a big purchase like this causes stress, so get as many details as necessary before making any decisions.

Wrapping Up

The delay in new vehicle deliveries may be frustrating, but it's important to remember that the pandemic has caused disruptions across all industries.

We've outlined several steps to ensure the delivery process goes as smoothly as possible to avoid any unexpected complications in the future.

Additionally, look into what kind of warranties come with your new car and if they cover any unforeseen delays.

But when a new car is ready to transport, A-1 Auto Transport will ensure it happens smoothly. As always, A-1 Auto Transport is the perfect choice for those looking to ship their car reliably.

Browse our website for our services and check out past customers' experiences. Then, get a no-obligation, free quote today.