If you’re in the market for a car, you may be in for a surprise, and we’re not just talking sticker shock, but nearly empty lots.
Inventory is historically low thanks to a major computer chip shortage.
In this 7News special report, car shortage, we looked into what this means for buyers forced to shift gears on the selection and prices they are used to seeing.
From the transmission to the breaks, virtually every system in a new car nowadays is computerized; run by what’s called semiconductor chips.
Lately car buyers like Sheila Yelton from Rutherford County are finding out the hard way that high tech dependency has become a bit of a problem.
A chip shortage has put the brakes on new car production, since automakers can’t send incomplete cars to dealer lots.
“I’m not finding anything, it’s just bare,” said Yelton.
Auto dealers say the problem is historic.
“I’ve never seen it like this before,” said Vic Bailey who owns 6 franchises at Vic Bailey Automotive in Spartanburg.
He says his normal 90 day supply is now down to 30.
“Usually we would have new cars all the way down the row and a full line of new cars on the second line behind it and then we would have another row of new trucks all the way down Daniel Morgan Avenue. And now you see our Fords are right here in front of the showroom. So big different from how it normally looks,” he said.
So what’s behind the shortage?
A spike in demand during the pandemic for computers lead chip makers to switchover from auto to devices.
Then a March, a fire struck the world’s largest auto-chip plant in Japan.
That was followed by a sudden spike in demand this spring from car buyers with stimulus money to burn.
It all translates to what Bailey calls: “Kind of the perfect storm.”
Bailey said American manufacters like Ford seem to be hit harder than foreign ones right now. 7News reached out to the BMW plant in Greer and a company spokesperson said “The BMW Group ordered the required volume of components for 2021 at the appropriate time, and we expect our suppliers to fulfill these orders as stipulated by the contract.”
Bailey says most manufacturers have told him inventory will only get lower in June. He says the take-home is if you absolutely need a car soon, don’t wait until June. But if you can hold out until 2022 that’s ideal because summer discounts could be non-existent, and you might not see any dealer incentives through the end of the year.
For the used car market , it’s virtually the same story on repeat.
“Never seen this,” said Jonathan Weaver the owner of Charlie’s Used Cars in Spartanburg.
He showed us an ariel photo of the lot from 2014. Today, it’s virtually barren. .
“Yeah, so normally our cars are here, 100 or so all the way down to the sign down there just in the front line, and then the ones in the back to be reconditioned. So now this is what we’re looking at, about 20 cars, when normally we’re running between 70 and 80.
Weaver says the shortage of new cars means people aren’t trading in. And prices for used have jumped.
Back at the new car lot, Yelton isnt’ liking her odds either.
“They’re so expensive right now and a lot of the dealerships aren’t offering any kind of rebates or anything or great warranties, so that makes a big difference as well,” said Yelton.
It’s certainly a hard time for buyers and dealers.
But with half a century experience each, both Charley’s and Vic Bailey’s are making the best of things by repaving the now empty lots. And both are looking forward to better days down the road.