Carmakers feel chip crisis easing

I saw an article recently saying that dealerships and car makers want to keep inventories low because they like the post-covid margins they're experiencing. When I paid 5k over msrp a few months ago the salesperson claimed they wanted more inventory because salespeople were unable to hit the volume goals they have. Not sure who to believe but I'm sure the truth lies somewhere in between.

We don't notice any easing in the embedded devices industry. In fact, things are as bad as they ever were right now.

Really glad that dealers in Canada can't charge over MSRP for new vehicles.

Disclosure: I work for GM. Anything expressed here is solely my own opinion and experience.

I think each statement is true.

Context: for ages, OEMs (the factory) have had a belief that Americans will not wait to buy a car. There's also a bit of a prisoner's dilemma: if any automaker wanted to trim inventories, the customer could go to a competing automaker's lot and buy today. Since customers will not wait to buy a car, a dealership must have some quantity of vehicles that are acceptable to buy today.

Now customers are used to waiting and nothing really catastrophic happened to the dealer or the OEM. In fact profits went up substantially. If OEMs or dealers had worked together to limit inventory, that would be illegal market manipulation. (I'm sure someone may build a conspiracy theory out of this, but I do not believe any intentional market manipulation took place).

Dealerships hate carrying extra inventory because it costs money to finance the vehicles until they sell them.

However, there are also salesperson and dealership bonuses based on volume, so that individual salesperson is feeling the pinch. Kind of similar to how crazy home prices are right now (in many large cities) - the homebuyer is hurting, but the real estate agents aren't making a commensurate amount of extra money because the market is relatively inelastic.

In future American OEMs may move to a more European model where vehicles are built to specific customer order. This takes on the order of two months at the moment for many legacy reasons, but there is no need for it to actually take this long.

Still can't buy RaspberryPis... not sure if it's related. But for some reason I can still buy boat loads of ESP8266 and other micro-controllers...