Buying Cars In 2022: Paying Over Sticker Is The New Normal
High demand for scarce new cars has flipped the script from, “Nobody pays sticker price” to, “Everybody pays sticker price. Or more.”
What can consumers do to avoid high prices, which auto industry analysts now expect to last all this year and into 2023?
Latest Threat to Car Supplies: War in Ukraine
What’s changed since then, of course, is the Covid-19 pandemic followed by the shortage of semiconductors (chips). Through December 2021, the chip shortage cost North American auto factories more than 2.3 million units of production, according to AutoForecast Solutions. Some analysts say the chip shortage will ease later this year. Others say it will stretch into 2023.
Now, the Russian invasion has closed auto parts factories in Ukraine. They supply factories in Ukraine and eastern Europe. VW said the lack of Ukraine-sourced wiring harnesses will halt car production for much of this week at factories in Dresden and Zwickau, Germany. Zwickau is home to Europe’s largest EV factory. Some of those EVs are destined for U.S. dealers.
Individuals Compete with Corporate Fleet Buyers for Cars
Individual buyers and fleet customers are now competing for new cars, says David Hult, president and CEO of Asbury Automotive Group, a dealership chain in Duluth, Ga. “To me, the demand seems so high right now, even when they’re able to start catching up on the inventory, between the rental car companies and fleet businesses and everything else, I just don’t see the demand settling until sometime into ’23,” he said.
As for markups, “It’s on everything,” said Las Vegas Ford and Porsche dealer Gary Ackerman, dealer principal for Gaudin Motor Co. “It’s a classic case of supply and demand; it’s not something any of us had anticipated,” he said.
For certain high-demand versions of the Ford Bronco, Ackerman said he’s gone to collector-car auctions in the recent past, where customers re-sold vehicles they just bought new. Like the dealers they bought from, collectors are selling cars for well over what they paid.
Read full original post here: https://www.forbes.com/wheels/news/pay-above-msrp/