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Carmakers feel chip crisis easing

bloomberg.com

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Re: Carmakers feel chip crisis easing

#161

Post by bin_bash »

ChrisRR wrote: post #149
d110af5ccf wrote: post #83

Earlier quoted context omitted.

> no more paying comprehensive insurance Assuming you can afford to replace it on your own if you need to, this one really adds up.

As a brit where at least 3rd party insurance is a legal requirement,I consider that everyone should be fully comp. It's not just your car you're damaging, it's likely another car and potentially legal fees and loss of earnings. Even if insurance went optional I'd still go fully comp, as the cost of a new car is not what I need if I'm already financially struggling due to injury

That’s liability insurance, not comprehensive.

In the US you either have to have liability insurance or be very wealthy. Bill Gates has no need for insurance after all.

Re: Carmakers feel chip crisis easing

#162

Post by empyrrhicist »

causi wrote: post #134
walrus01 wrote: post #63

Earlier quoted context omitted.

> Context: for ages, OEMs (the factory) have had a belief that Americans will not wait to buy a car. On the contrary, we recently added a 3rd car, and it ended up being a $4000 used Toyota Camry. My first choice would have been a Corolla or civic but none were available at a reasonable price, condition and mileage. Due to the well known rise in used car prices. It's in good enough condition and meets all the requirem…

Indeed. I've been doing similar research myself and was surprised at how highway driving can disadvantage EVs. They'll never be as expensive per mile as an ICE vehicle but I found the fact I spend most of my commute at 80mph significantly decreased the savings.

I mean, driving at 80 vs 70 will also vastly decrease your ICE mileage, it's just less noticeable until you go to fill up.

Re: Carmakers feel chip crisis easing

#163

Post by sharpneli »

rootusrootus wrote: post #50
chrismmccomas wrote: post #23

Earlier quoted context omitted.

I had been shopping since January for a 2022 Tundra. I talked to salespeople at probably 75 dealerships on the east coast/mid-atlantic. Two of them said they could order me what I wanted, with a large deposit and I’d have to wait up to 90 days. The remaining all said basically they’re at the mercy of what Toyota makes and decides to allocate to their dealership.

That's pretty normal for the Japanese manufacturers, especially on anything they build in Japan. It has always been the domestic manufacturers who were willing to build you a car exactly to your specifications.

That’s US specific thing.

I ordered a RAV4 PHEV (prime in US) last year and it was a factory order from Japan. Toyota Europe app even tells you when it’s built and then tracks the shipment to your local Toyota dealership.

Re: Carmakers feel chip crisis easing

#164

Post by _fat_santa »

ineedasername wrote: post #159
csours wrote: post #8

Earlier quoted context omitted.

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 c…

OEM's and dealerships make a very large amount of their profit on parts (OEM's) and repairs (dealerships). And both make money on financing. This is especially true for dealerships. Sure during a shortage dealerships are happy to sell limited inventory at much higher margins but in the long term that's going to eat into their bottom line. Financing alone often surpasses profits on the car itself. Then also fewer peop…

There's also the fact that many dealerships are doing deals fully online. So your local Ford dealer isn't competing with the other one in town, they are competing with the other one in town and all the ones that facilitate online deals.

This has become the thing to do if you want to avoid dealer markups. Just call around until you find a dealer that will honer MSRP and will ship to you, then do the deal with them.

Re: Carmakers feel chip crisis easing

#165

Post by itsoktocry »

csours wrote: post #8
RyanShook wrote: post #2

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.

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 c…

>Now customers are used to waiting and nothing really catastrophic happened to the dealer or the OEM. In fact profits went up substantially.

"Nothing catastrophic happened to the dealer" only in a world where dealership employees don't count. My VW dealer had to lay people off, not enough volume.

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

Well, yeah, this is literally every single retail business anywhere. Who wants to carry inventory? The point is to turn it over ASAP. That doesn't mean the optimal level of inventory is zero.

Re: Carmakers feel chip crisis easing

#166

Post by itsoktocry »

KerrAvon wrote: post #86
walrus01 wrote: post #63

Earlier quoted context omitted.

> Context: for ages, OEMs (the factory) have had a belief that Americans will not wait to buy a car. On the contrary, we recently added a 3rd car, and it ended up being a $4000 used Toyota Camry. My first choice would have been a Corolla or civic but none were available at a reasonable price, condition and mileage. Due to the well known rise in used car prices. It's in good enough condition and meets all the requirem…

I applaud you for not taking the bait on the Model 3, which is overrated, but I cannot fathom purchasing an appliance car like a Camry. You can’t possibly enjoy driving it. Why not at least a Honda?

>Why not at least a Honda?

Go out and actually drive the cars in this class and they're pretty much all the same. Honda build great cars, but let's not pretend you hop in an everyday Civic and it'll blow your socks off. They are very pedestrian.

We bought a Mazda3 because my wife didn't like the sight-lines in the Civic. YMMV.

Re: Carmakers feel chip crisis easing

#167

Post by kasey_junk »

itsoktocry wrote: post #165
csours wrote: post #8

Earlier quoted context omitted.

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 c…

> Now customers are used to waiting and nothing really catastrophic happened to the dealer or the OEM. In fact profits went up substantially. "Nothing catastrophic happened to the dealer" only in a world where dealership employees don't count. My VW dealer had to lay people off, not enough volume. > Dealerships hate carrying extra inventory because it costs money to finance the vehicles until they sell them. Well, ye…

> That doesn't mean the optimal level of inventory is zero.

It does if the customer will wait for you to produce the good for the same price (or better!) as the inventoried one.

Re: Carmakers feel chip crisis easing

#168

Post by aidenn0 »

ssharp wrote: post #136
aidenn0 wrote: post #57

Earlier quoted context omitted.

> 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. You've been able to do this in the US forever; you just might have needed to pay closer to (or even at) sticker (now I'm sure it's higher than sticker).

I can't believe people go to a dealer and are willing to drop $30k+ on a new vehicle that isn't to their exact spec just to drive away that day with something new. There usually aren't too many options on cars -- color, wheel design, a few packages. If I'm spending that much money on something, I'd want exactly what I want. I've even flown to a dealer a few hundred miles away to buy the exact car I want and drove it…

If I drive a car for ten years and I save over $1k for getting a "meh" color instead of the color I want, that's over $100/year that I save. I am 100% willing to be paid $100 each year in exchange for driving a gray car.

I suppose I've also never spent over $30k on a car...

Re: Carmakers feel chip crisis easing

#169

Post by itsoktocry »

BenoitEssiambre wrote: post #12
csours wrote: post #8

Earlier quoted context omitted.

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 c…

>Dealerships hate carrying extra inventory because it costs money to finance the vehicles until they sell them. Note that with interest rates having been really low, even negative in real term, an inventory was almost a good investment with relatively good returns (if you could get your hands on it). Now with rising interest rates and falling inflation, the cost of financing might become a burden again.

>an inventory was almost a good investment with relatively good returns

This is a great point. Any dealer who had surplus inventory heading into summer 2020 did really well on their margins I bet. Of course, not something you want to base your business around...

Re: Carmakers feel chip crisis easing

#170

Post by eweise »

jazzyjackson wrote: post #99
ck2 wrote: post #60

Just in time for $6 gas. Are people seriously going to buy anything other than a hybrid or full EV at this point?

I don't really see how $6 gas is materially different from $4 gas And yea, F150s and Tundras are still going to outsell anything less than 5 feet tall, don't really know what to tell ya

Sure. And that's why there is a waiting list a mile long for electric F150s.
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