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buying Who's loving the semiconductor chip shortage? Car dealerships

21:00  26 april  2021
21:00  26 april  2021 Source:   cnet.com

Toyota, Lexus Upgrade Tools So You Can Buy New Cars 100% Online

  Toyota, Lexus Upgrade Tools So You Can Buy New Cars 100% Online Toyota's SmartPath and Lexus's Monogram systems are expanding to a lot more dealers, meaning you only have to show up at a dealership if you really want to.The idea behind the year-and-a-half-old comprehensive retail program was to make buying a new Toyota or Lexus as easy as possible but, during the COVID-19 pandemic>>>P, the mostly contact-free aspect has been a selling point as well. Toyota says a Cox Automotive digital shopping study from last April showed that two-thirds of shoppers are more likely to want to purchase a vehicle 100 percent online.

Car buyers on the hunt for a new set of wheels enter a very different world compared to this time a year ago. In April 2020, automakers and dealers would do anything to sell a car, including the option of generous 0% financing options we hadn't seen in years. Today, prepare for no such incentives, and certainly no helpful cash-back offers. Why? Thank the semiconductor chip shortage, which dealers are really enjoying.

Too few new cars means bigger profits for dealers. Kittikorn Nimitpara/Getty Images © Provided by Roadshow Too few new cars means bigger profits for dealers. Kittikorn Nimitpara/Getty Images

Reuters reported on the state of the industry on Monday and profiled a couple of dealerships caught in the middle of eager car buyers and too little inventory. It's a simple story of supply and demand: Automakers can't build enough new vehicles, due to chip shortages, and car buyers want them. In turn, many buyers have no problem paying sticker price and foregoing the wheeling and dealing that can knock a couple grand off the MSRP. Dealers get to keep even more cash in their pockets and buyers get their new car. Record profits ensue.

Chevy Corvette remained fastest-selling car in March, Toyota RAV4 Prime not far behind

  Chevy Corvette remained fastest-selling car in March, Toyota RAV4 Prime not far behind The Corvette's inventory likely remains in short supply, and ditto for the RAV4 Prime.Still, according to new data from iSeeCars on Wednesday covering the month of March, a Corvette only stuck around at a dealership for 9.4 days on average. The average time to sell a vehicle sits at 47.4 days for all new vehicles, underscoring how quickly a Corvette in stock turns into a sale. While General Motors works to build the sports car as quickly as possible for eager fans, the second-place finisher is pretty surprising.

  Who's loving the semiconductor chip shortage? Car dealerships © Kittikorn Nimitpara/Getty Images

Read more: From PS5 to Ford F-150: How a global chip shortage is 'impacting everything'

One Buick-GMC dealership said nearly every single car in its inventory is spoken for, with buyers going as far as reserving vehicles that haven't even rolled off the assembly line. Another Toyota dealership, which typically stocks a few hundred cars, had 62 new vehicles ready to sell.

The ripple effect has reached the used car market, too. While the coronavirus may have first lopped a chunk of change off your car's value last year, this year, dealers are itching to sell whatever they can. Franchises told Reuters if a 2021 model year isn't in stock, buyers are increasingly looking at preowned models to get a nearly new car. Again, with demand up, used car prices trend upward, too.

Used Car Shoppers Might Find the Best Deals over 100,000 Miles

  Used Car Shoppers Might Find the Best Deals over 100,000 Miles With used-car prices up an average of 14 percent this year, it's good to keep in mind that cars last a lot longer these days.By July, used-car values found their legs. And by October, used-car prices had made record-breaking leaps. Now, six months later, prices still hover at altitudes that require supplemental oxygen. CarGurus' tool for tracking used-car price trends shows the average price of a used car is $23,723, up almost 14 percent compared to this time last year. That's more than 10 times the 2020 rate of inflation. Every vehicle segment has seen gains, the smallest bump being about 5 percent for hatchbacks and wagons.

It's not all good, though. If inventory continues to dwindle for months, dealers could face an issue with overall profits if lower volumes of sales begins to offset the gains from selling at sticker price. We don't have a crystal ball, but right now, it's a good time to be dealing cars.

The best cars to buy used rather than new

This was originally published on Roadshow.

5G, E-Vehicles & Co.: Micron-CEO sees strong semiconductor growth Advanced .
The chip manufacturer Micron has a strong quarter behind. The outlook for the ongoing fourth quarter also exceeded the estimates of the experts. The strong demand is caused by need for more and more different industries, including in the field of e-mobility. © Provided by finanzen.net Daniel Roland / AFP / Getty Images • Micron brings record quarters behind • Chips needed in more and more areas • 5g drives demand for for Micron Technology could hardly run it hardly better.

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