supply

New Car Sales in 2022 Will See Bigger Rebound as Chip Supply Improves, Analyst Says

By Betty C. Morrow 3 weeks ago

After a shortage in computer chips contributed to a shortage in new cars in 2021, analysts expect an improvement in chip supplies in 2022 to help new car sales rebound. An average gas-powered vehicle has about 1,000 computer chips, while electric-powered cars can have more than double that total, leaving the market with low car supply and high prices without sufficient stock.

Phil Amsrud, an IHS Markit analyst who follows automotive chips, predicted that supplies wouldn’t get better immediately in 2022 and would likely be better in the second half of the year.

“We’re seeing 2022 as being an improvement over 2021, but it’s not going to start January third or fourth,” he said.

Still, experts and analysts are unsure when chip supplies will reach levels from before the pandemic.

Cox Automotive predicted that new car sales in the U.S. will increase this year by more than one million to

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Almost 10m less cars built in 2021 as supply chain issues hit production

By Betty C. Morrow 1 month ago

Nearly 10m fewer cars were built this year due to supply chain issues and a semiconductor shortage, analysts say.

Research by market intelligence group LMC Automotive estimated a 9.6m global shortfall in the number of light vehicles produced through 2021. European carmakers are expected to have suffered the biggest hit, producing 3m fewer vehicles as they struggled to get hold of supplies.

Semiconductors have been one of the biggest pain points in global supply chains, with delays, production disruption and hoarding spurred by the Covid-19 pandemic leading to a severe shortage.

The crisis is still running, LMC said, with the situation for car makers unlikely to substantially improve until the second half of 2022, and the gulf between chip demand and supply taking until 2023 to close.

Justin Cox, the group’s head of global production, said the outlook had improved slightly in recent weeks as emergency measures boosted production.

“I

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Record Revenues, Gross Profit Per New Vehicle, As Demand Outstrips Supply

By Betty C. Morrow 3 months ago

As high demand and low new-car inventories drive record high prices across the U.S. auto industry, dealership group Sonic Automotive reported record third quarter revenues of $3.1 billion, a 20.6% increase vs. a year ago, and net income of $84.5 million for the quarter, up 41.2%,

“Consumer demand is still very, very strong,” said Sonic Automotive CEO David Smith, in a phone interview on Oct. 28, following a conference call to announce third-quarter earnings.

“Our new-vehicle days-supply is at an all-time low. The demand for new vehicles is at an all-time high, and we’re at an all-time record gross profit per vehicle, in our new-vehicle sales,” he said.

Smith said in the earnings call that Sonic’s 84 franchised, new-car dealerships had a record low of only around 2,400 new cars and trucks in inventory, representing a 10-day supply at the current

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Bidding war over a 2-year-old minivan? Used car market goes ‘bananas’ over lack of supply

By Betty C. Morrow 3 months ago

Brad Wimmer and Greg Markus of AutoLenders watch a used-car auction from their dealership in Lawrenceville, N.J., on Oct. 22. (Photo by Michelle Gustafson for The Washington Post)

LAWRENCEVILLE, N.J. – The 2019 Honda Civic that kicked off a used-car auction earlier this month would have been nothing special before the pandemic. But as automotive dealer Brad Wimmer watched, the online bidding quickly became, to quote him, “bananas.”

As a new car, the Civic would have had a sticker price of around $21,000. But within seconds at the wholesale auction, the two-year-old model, with 4,000 miles, sold for $27,200.

Soon after, a Nissan Rogue fetched what it would have cost new in 2018. A three-year old Toyota Camry with large dents and scratches on its hood sold for $14,200, nearly twice what it would have brought just a few years ago. And a 2015 Kia Sorento sold for $12,600,

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