Empty lots, vacant showrooms and lack of inventory is a few of the problems plaguing the car industry both locally and nationally.
Semiconductor chips that control certain amenities from power steering to emergency braking systems is on back-order from their manufacturers due to COVID-19.
Jack Minnick, assistant sales manager at Duteau Chevrolet on South 27th in Lincoln, said Duteau cannot provide cars to consumers because of the shortage, and more orders for cars are being placed than ever.
“We can’t exactly guarantee when it’ll be here,” Minnick said. “But at least we know if you put your order in, it’s saved in there and your car will be here.”
Minnick said customers looking to buy a car by showing up to the lot need to be aware of the limited vehicle selection available. Customers who want a specific make and model should order a car now, he said.
The chip shortage is affecting nearly every dealership around Nebraska in some way.
“The biggest thing affecting us is inventory,” said Aaron Flanagan, sales manager at Nissan of Omaha. “We do not have enough vehicles to sell.”
According to Flanagan, being able to purchase the exact vehicle the customers want is tough and that most time, the dealership will not have what the customer wants.
“People are settling a bit because we are selling what we have,” Flanagan said. “People are putting their money on cars and buying them sight-unseen.”
A once nearly full lot now holds just over a dozen vehicles at Nissan of Omaha off 174th and Burt. Photo by Ben Porter/NNS.
Because of the high demand for new vehicles, inventory is sold before it even hits the dealership lot.
Thirty percent of new vehicles at Nissan of Omaha sells before arrival. According to Stewart Akrin, senior sales consultant at Baxter Subaru in Omaha, 90% of their new inventory sells before getting to the dealership.
According to Terry Csipkes, a sales manager at Huber Automotive in Omaha, cars selling before they hit the lot accounts for 70% percent of their new inventory.
The national car shortage is not just specific to new vehicles. Finding quality used vehicles to make a profit on is difficult for dealers to find at auction.
“It is harder to find cars at auction because prices are high,” Flanagan said. “They run the chance of selling them at a loss because they are paying too much for them upfront.”
Minnick said $8,000 to $18,000 is the most popular price range for used car buyers but because of the inflated prices of the vehicles, it is hard for them to find quality cars at auction that they can make a profit on.
According to Csipkes, Huber Automotive at 111 West Dodge Road in Omaha, has had to buy most of their used cars from online auctions that are out of state, not knowing the full extent of the quality of the vehicle they will receive when it arrives at their dealership.
The pandemic shortages is also affecting the repair side of the business.
Parts for Hyundai, Honda and Acura are the hardest to come by, according to Dingman’s Collision Center in Omaha. Employees have reached out to dealers in other states looking for parts for vehicles they have to repair.
Local dealerships looking for inventory like Baxter Subaru at 171 Burt Street in Omaha are calling current customers to try to get them out of their leases early. Because there is less new inventory, the market for used vehicles has increased. Others like Duteau and Nissan aren’t actively calling but are open to purchasing vehicles from people looking to sell.
Honda of Lincoln at 2770 Yankee Hill Road in Lincoln has nearly an empty lot because of their shortage in inventory. Photo by Ben Porter/NNS.
With new semiconductor chips starting to be manufactured, all three dealerships see the current inventory shortage to start resolving by the end of this year and resolve completely by 2022 and 2023.
“We’re doing the best we can every day,” Minnick said. “And sell what we have and what’s in the system.”
