There’s an unexplainable thrill that comes with shopping around for a new car. It doesn’t matter whether it’s your first car or an upgrade to the latest model; the excitement is always on another level. Well, car buying should be an exciting experience, especially when you can get the right color, model, and trim right within your budget.
In a Bloomberg article, it’s clear that when there is a shortage of cars, buyers will grab the cars of their choice from dealerships trading off color for availability. At the beginning of 2021, car sales surged by 8 percent as people snapped what they could get in anticipation to return to their offices. This comes after a mass vaccine rollout that has seen millions of Americans vaccinated against COVID-19.
The rising demand for new vehicles
At this time of the year, most people are going for new cars because they don’t want to use public transport. This trend increases the demand for vehicles in a market where there is already a shortage of vehicles. As a result, car buyers are buying cars with certain features and specs they don’t like. Also, the demand for used cars is on the rise. People with tight budgets are going for used cars to avoid public transit.
According to Bloomberg, since factories reopened last summer, there has been an increase in demand for new cars as people look for new rides. Retail deliveries are soaring high leaving consumers with fewer choices to make. If one gets the car with the right performance and specs, they can easily trade off color.
Strong Q1 car buying results for the auto industry
One of the primary reasons there are few cars in the inventories is because of the chip shortage. CNBC has revealed that the semiconductor chip shortage is likely to cost the global auto industry $110 billion in revenue in 2021. The pandemic prevented chip manufacturers from producing enough chips for the market. In most factories across the world, social distancing measures and associated coronavirus regulations paralyzed the production process.
Impulse car buying accelerated sales in 2021 as folks were afraid of impending car shortages. This is reflected in CNBC’s report showing that car sales rose despite the chip shortage due to high demand. The report shows that improved car buying has increased sales for Volkswagen, Toyota Motor, Hyundai Motor, Stellantis, General Motor, Kia Motors, and Ford Motor. CNBC owes the increasing demand to stimulus funds, reopening of the economy, and increased vaccination rates.
Also, according to Forbes, the spike in demand for new cars in Q1 of 2021 will extend to Q2. The auto market has rebounded in response to a better economic environment than 2020. Forbes adds that most auto dealerships are likely to record high sales this year. Automotive News corroborates this by demonstrating how Toyota, Hyundai, and Honda have already recorded decent car sales in Q1.
Car buying for normally unwanted vehicles
Because of chip shortages and supply chain problems caused by the pandemic, there are fewer new cars for sale than usual. Buyers are forced to purchase the available cars without paying much attention to colors and other niceties.
Color isn’t the only factor car buyers are foregoing in 2021. As consumers avoided public transport in most part of 2020, they flocked showrooms and bought whatever met their transport needs and budgets. This has continued through to 2021 where stimulus checks and impressive vaccination rates are boosting car sales.