Car shortages lead to industry changes

Published: Aug. 17, 2022 at 10:40 PM CDT
Email This Link
Share on Pinterest
Share on LinkedIn

SHERMAN, Texas (KXII) - The car industry has been dealing with supply chain issues since the early phases of the pandemic, making the process of searching for and buying a car difficult for some consumers.

Jeremy Wiggains is the Chief Operating Officer for Vanguard Auto Group.

He said, “Our inventory, is about a third of what we’re used to, simply because they can’t get enough of the parts together at one time to put all of the cars together.”

According to Wiggains, manufacturers may physically have many cars in their possession, but they aren’t ready to be sold.

Wiggains said, “General motors has 95,000 vehicles sitting, that are built short 1 or 2 pieces that are necessary to complete the transaction to get the car shipped to us.”

How does that affect consumers?

Wiggains explains, “The problem is, there’s not enough new cars, but we have to have cars to sell, so as car dealers, we’re buying as many pre-owned vehicles as possible and that demand for pre- owned cars have also driven the price of pre-owned vehicles up.”

Which isn’t necessarily a bad thing, if you’re ready to sell your car.

However, if you’re in the market to buy a used car, get ready for sticker shock.

Pre-owned dealership owner, Todd Kofsky, says the demand for used cars makes it tough to keep the prices low.

Kofsky said, “the whole industry’s car pricing has simply gone up. we purchase cars at wholesale and the wholesale price have simply gone up, and that same percentage passes on to our customers.”

Still, people need cars.

Kofsky said, “We’re actually selling cars pretty quickly when we find them and people appreciate that we’re getting inventory. "

But when can consumers start to see cars prices stabilize, and inventory return to normal?

That’s something Wiggains said, is hard to foresee.

He explained, “It’s a multifaceted issue, it’s not just one thing. it’s not just a chip. it’s a combination of several different events that caused this to go on.”

Copyright 2022 KXII. All rights reserved.