The majority of the 2022 calendar year has been dominated by headlines regarding the global chip shortage, with automakers scrambling to shore up microchip supplies and keep production lines rolling amid strong consumer demand. Now, one recent study indicates that roughly half of consumers may postpone their vehicle purchase as a result of the chip shortage.
According to a recent report from Cox Automotive, roughly 45 percent of consumers would postpone their vehicle purchase as the chip shortage drags on. That figure remains consistent with statistics recorded in November, and a drop compared to the 48 percent of consumers that said they would likely postpone a purchase in August of 2021. By comparison, 37 percent of consumers said they would postpone a purchase in April of 2021.
The insights were provided via Cox Automotive research conducted between March 2nd and March 9th of 2022, with a sample population size of 242 individuals.
The Cox Automotive research also indicates that consumers are now more aware of the chip shortage than previously, with 60 percent of consumers surveyed “very aware” of the shortage, as compared to just 28 percent in April of 2021. Just 2 percent of those surveyed had not heard of the chip shortage prior to the survey in March of 2022, as compared to 24 percent in April of 2021.
Along with greater awareness of the chip shortage, consumers are also more pessimistic about its long-term effects. Most consumers surveyed (57 percent) believe that the shortage will result in elevated vehicle prices even after the chip shortage has been resolved, while 39 percent believe that prices will return to pre-shortage levels, and 4 percent believe that prices will be lower than before. Additionally, most consumers surveyed (35 percent) believe that the chip shortage will last for at least another year, as compared to 20 percent who think the shortage will be resolved in 6 months and 18 percent who believe it will be resolved in the next 7 to 12 months. Twenty-seven percent of consumers surveyed said they did not know when the shortage will be resolved.
Finally, fewer consumers are now willing to pay over MSRP for a specific vehicle as compared to earlier in the chip shortage (28 percent now versus 33 percent in November), but those who would pay above MSRP would be willing to dole out an average of 20 percent over MSRP to get the vehicle they want.
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Source: Cox Automotive
Comments
It’s hard paying 10k+ over MSRP for vehicles that are not even complete due to chip shortage.
I’m waiting for 10k off truck month, will never buy for MSRP and missing features due to chip shortage.
Shockandawe-
I’m waiting for “truck month” too. But I have a feeling we will be waiting for a long time!
I understand that we’re paying to much right now but where are all you people that say your paying 10,000 over Msrp shopping??If your dealer is charging you over msrp go somewhere else.No dealer near me is charging over msrp, they already know that’s to much.
Call jones junction in Bel Air MD , Hybrid, 10,000 over and regular camery, 5,000, called yesterday
Something doesn’t add up. I remember reading articles explaining that rising car prices and shortages were (in part) due to rising consumer demand. Now we read that half of consumers would postpone their purchases, which doesn’t sound like high demand to me. Something has got to give – either the corporations will break down and make deals again or the economy is going to tank. I can’t see this current state lasting much longer.
I will wait it out myself. Even the used car market is crazy. They want top dollar and will not budge on junk too.
How can consumer demand be rising with car manufacturers still having certain factories shuddered? Consumer demand has not returned to 2019 levels at any time in the last 2 years. This is purely the supply chain coming apart at the seams; all the while consumers are loosing confidence that there will be a quick recovery and nobody has faith this administration is doing anything to help, in fact hurt the situation. Declaring war on Amazon won’t help anymore than declaring war on American oil or Russia.
Let’s go Brandon.
Jake
Over 10 million jobs created since President Joe Biden took office. #FastestRecoveryEverRecorded
You’re just sore because another Trump company is going Bankrupt (Truth Social)
Peter g you would be wrong.they are counting the jobs that people are going back to after riding the unemployment gravy train, those are not new jobs…
Bob
Or Democrats have gotten really good at fixing the economy after Republicans destroy it.
FDR, Carter, Clinton, Obama and Biden all took over a Sh!t economy left by their republican predecessors.
You are an idiot
You keep claiming there won’t be no recession but funny thing Wall Street has been saying different and I hate to tell you this they hold more power then your boy in office.
You’re correct on your thinking, the USA is about to move into a recession. Despite Biden’s lies about the economy the US has had two months of economic downturn according to numbers that can’t be “tweaked” from the Congressional Budget Office, if April goes as Feb/Mar we will move into an recession. Now as for the chip shortage … close to 2 years ago the chip manufacturers told the auto, appliance, etc that they were going to do a upgrade, and in the auto segment they needed to “change” their “wiring designs/manufacturing” in order to use the new chips. The domestic auto industry didn’t listen. In about three weeks I’ll own my first foreign car as they made the change and a 2 to 4 week wait for a special order from Hyundai isn’t unusual. I’m not putting off a buying decision, I just found as good or better for less money, not trading just adding one extra to the family.
I’m on the sidelines until things settle down; chips and prices.
Was hoping things would be looking better by now but might be waiting until 24 to buy that new truck
I too, but I’m a not a ‘would be’, I am.
Agreed. I planned on buying a new truck late 2021 or early 2022 but I refuse to pay over MSRP, hell I refuse to pay MSRP. I told my wife that my old truck still runs and it’s paid for, no sense to get into a bidding war over something that will lose 15 to 20% of it’s value as soon as you drive off the lot.
I wanted to trade my 2017 GMC Acadia for the new Chevy Tohoe, but decided to stay put. Both new models have major issues and so low on the rating chart I don’t understand why they haven’t fix the same issues year after year. As an American buyer, I am having second thoughts.
Except they’re not losing value right off the lot. I made $7000 on my last truck after a year and a half, and 20,000 miles, and could sell my current High Country at a $10,000 profit.
I just checked KBB on my 2018 Crew Cab. It’s an LTZ and very desirable. The value had dropped $4,000.00 in the last three months.
You may want to check book value again.
The chip shortage isn’t a real problem, 2 years ago the chip manufacturers told the automotive segment that they were changing as to meet a greater demand … now the current model year (’19 to ’21) were given notice. They gave the domestics as well as imports to change their “Wiring Harness” for the sake of a better word in order to use the new chips, wasn’t a covid problem as the redesigned chips would work with countless applications as the auto types were limited in their use. Notice how Tesla hasn’t a problem?
Yeah, the domestic manufacturers did this to themselves, they were told with more than enough of a time frame to correct their processes … they didn’t. The Asian builders did listen. But, with the domestic builders still not changing their processes it’s buying time for another auto manufacturer to bring something to market. One I’ve watched is *Mahindra, they’ve got a great truck, won’t win a beauty contest … but if a work truck is in your future and the price is right …. well Dg, looks “ain’t” everything.
Fortunately those foolish 20% that would pay over MSRP will suffer the consequences.
Enjoy those higher interest rates. 30 year mortgage is already above 5% and that’s the beginning.
With a recession and rising interest rates creeping in, people will not be buying like they were 3-4 years ago. Smart people will wait it out. Who in their right mind would pay over sticker? Discounts will be back eventually.
Recession is coming, be ready!
Old School
President Joe Biden’s Bipartisan infrastructure bill passed. Which means 1.5 trillion dollars coming to repair roads and bridges.
AIN’T GOING TO BE NO RECESSION! ! !
There have always been plenty of infrastructure bills out there but most were loaded with “pork” and not very useful. The lack of electric infrastructure should tell you that, let alone our roads and bridges still crumbling with no proper plan in place to correct it. Those bills are only there to add to the Congress families wealth and take more from the taxpayer.
Obama said the same thing about TARP “shovel ready projects” and it never happened.
I saw a Chevy truck today that looked new I looked it up and sure enough these guys still make cars, I thought they went out of business in 08-09 or something? Didn’t they declare bankruptcy?
I guess it depends on the situation. My wife and I just leased two new vehicles from two different manufacturers in the past two months. Both vehicles were fresh off the car hauler and both cars were sold under MSRP (you just have to look for dealers that don’t do markups or keep rebates). I leased a ‘22 Dodge Durango GT AWD. It had heated seats, heated steering wheel (it’s cold up here in Michigan), rear park assist with auto braking…basically, I don’t have window sticker credits with promise of future retrofits. My wife’s Equinox lease had six months to go and she was over miles. The strong used car market allowed us to sell the Equinox and avoid the last payments and the over mileage fee. She wanted a new Blazer. She ended up getting a ‘22 Blazer LT AWD. No heated seats, no rear park assist, no heated steering wheel (not even leather-wrapped)…the buttons are all there, but no brains in the computer. The dealer estimates it will be 4th quarter before the heated seats chip is in. She loves the Blazer, so happy wife-happy life maybe? If you want deals, they are out there, you just have to look a little bit.
To tell you the truth the chip shortage should be almost over. I think that auto makers are using that excuse to keep prices up. Typical American cooperate greed.
Only an opinion.
Hate to break it to you, the chip shortage is not even close to over. Renesas (last year) and ASML(Jan 22) both had fires. ASML is going to hurt future manufacturing as they are an equip manufacturer. Another worry is neon which comes mainly from Ukraine and is essential to chip fab. I’ve had an order in for 6 months now for a certain product. There is no ETA on when they will have it. Last I checked even the wafer material is in short supply.
The automakers would like to build as many cars as they can. It doesn’t do them any good to have plants operating below capacity, or sitting idol. If you visit any city where Ford or GM have plants, you will see thousands of new vehicles sitting in lots, waiting for chips. That’s millions of dollars tied up in inventory, inventory they’re not making anything on when it’s just sitting there. If they had the chips, they’d be shipping them, so they could get paid for them. Greedy corporations aren’t helping their greed any, when they have millions of dollars tied up in unsalable inventory!
There’s no doubt the makers have taken advantage of the situation. They’ve raised prices (mainly on higher demand vehicles like trucks), and are offering smaller incentives, but it’s not the automakers that set market prices. Buyers being willing to pay higher prices for used cars, or paying over sticker for new ones, are setting the prices.
By the way, greed is not limited to America, Americans, or corporations. Greed is everywhere, and we’re all greedy to some degree. Being willing to pay over sticker for a car so you get it, not the next guy, is greedy. Buying more of something than you actually need, because it’s on sale, could be considered greedy. The Federal government always wanting more in the way of taxes from corporations and individuals, is surely greedy.
This is correct.
Example: GM Assembly in Wentzville, Mo is parking Colorado, Canyon, and Vans in lots all around St. Louis area. They’re up to 30k-40k so far (same as they did about this time last year) . GM Authority should look into this.
I got a fully loaded 2022 Canyon Denali for 800 under msrp and they gave me 34k for my 2018 Colorado Redline which I paid 38k for in 2018, not a bad deal, you just have to go to an honest dealer…
Hello Rodney I am doing the same now my dealer wants to give more than what I paid for my 2019 RST Silverado
All Star with the 5.3 v8 I want to upgrade to the LTZ reason being is it has the dual electric power seats . on the 2022 LTZ Limited it has several chips missing no heated seats no heated stieering wheel . I am ok with that with a later retro. I am in Florida we do not use heated seats that much along with the heated steering wheel. I also can save alot on a new upgrade . I notice on the window sticker is was listed with the package 62.000 and with the dealer discounts they will let it go for 52.000 this was the pric of the LTZ back in 2019. unreal
I will wait it out not paying over invoice period .
Another earth shattering study! Like, does the consumer have a choice? Thanks again J Lo.
The only reason they could say consumer demand is rising is due to the dealer lots are empty. The used car market is still absolutely crazy! The old adage of supply and demand reins supreme.
As for basing this study on only 242 people, it makes the 45% far greater in the real world. It is surprising that 2% still didn’t even know about the chip shortage to begin with.
I’m just happy I got my 2021 Yukon XL Denali Ultimate with ALL the chips, bells, and whistles before all this crap hit the fan!
Seems to me these trucks that are built should have been delivered. When you build 1000 trucks each day you need to have enough drivers to deliver them shouldn’t be sitting for months it makes no sense.
I Don’t care about the chip shortage, I am postponing my purchase because there are very few new trucks available and the dealers want more than MSRP! I have the employee discount but I’ll wait and then special order if I have to to get what I want. My current vehicles are in great shape so no hurry.
In southwest utah some of truck’s on the ford dealers lot are 30-40k over sticker (3/4 and 1 ton diesel). I can’t believe someone pays that. Complete rip off
As the old song by Dion Warwick say, “walk on by”. ,….. Even $1 over MSRP is too much for me since mom didn’t raise a dummy. You’d have to have money to burn if you’re foolish enough to spend $30-40k over MSRP
Wow, fly to the east coast and pay MSRP if not a discount..
Need to wait, a recession is coming with higher interest rates which will slow demand and bring back rebates. Those with cash will get great deals same as 2009 and 2012. Save your money and wait for the super deals. PS. Don’t buy a house now either!
The guy who wanted to nuke a hurricane, rake forests, and stared at an eclipse “knew” so much. Or maybe it was all part of his populist bs message with no real substance.
Every day GM announces something new that’s unavailable. I will not settle for less as GM follows the current Federal administration goals of “settle of less, lower your expectations “ theme. I’ve held out ordering my Suburban cause “I Will Not Settle For Less”. Wake up GM you are losing customers but I guess that’s the plan!
GM needs new leadership who listens to customers instead of government!
I’m not going to pay good money for a vehicle that is not including the things I want. I’m not going to settle for what’s on the lot at this point. If I can’t order and get what I want I’ll just wait until life get back to normal. If it ever does??
Sorry, i definitely don’t pay over sticker… and i don’t even pay sticker!!
There are dealer who really want to sell a vehicle!!!
Chip shortage is FAKE. Totally made up bs.
It’s all a scam.. it’s the push for EV.. but what the tree huggers don’t get is this. Cal already has rolling black outs because there electric grid can’t Handel the AC on.. now plug in thousands of cars .. stupid … ! They never seen a car get recycled either. So if you live at an apt complex and 4 people drive we’re ya putting the charging stations..! Again no grid .! Oh and how far can ya drive.. chip shortage, high fuel prices , interest, cost of housing .. get ready .. the tank looks pretty damn big .. gonna be epic..! Be prepared. Took months and months for a 600$ stimulus ck,, but took hrs for 14 billion to go to Ukrainian ..just think what legal Americans could do with a million dollar check. You don’t need a phd to figure this out..