KENDALLVILLE – As things started to reopen in the spring after COVID-19 restrictions were lifted, businesses began the recovery process after being largely shut down for almost a year.
The strong demand for new vehicles has now been affected by the shortage of semiconductor chips, resulting in dealerships having smaller inventory than usual.
Local auto dealers in northeast Indiana are feeling the result of the chip shortage firsthand.
âOur inventory levels are extremely low. We only have a handful of new vehicles, âsaid Jeff Platt, sales manager at Max Platt Ford-Lincoln in Kendallville. “We haven’t had a new Lincoln here for several months, so we’ve been without Lincoln models for a few months now.”
The dealer’s typical inventory for new vehicles is around 50. He currently has around eight to ten new vehicles in his lot.
Local dealers have responded to the shortage by shifting their services to online ordering. So instead of customers going to the dealership, they allow them to customize the vehicle they are buying without ever having to choose one from the lot.
Online ordering became the new normal for local dealerships when the pandemic forced them to close their showroom and do virtually everything.
Platt said Ford and Lincoln do a fairly good job of focusing on customers placing orders rather than just focusing on inventory numbers.
âThey are under construction, we are notified by the company when the vehicle is built,â he said. “The second part, which we are dealing with now, is the chip socket, when they inform us that a vehicle is on a chip socket with a provisional ETA (estimated time of arrival).”
He said the chip shortage started when the pandemic hit and automakers stopped ordering chips while other companies continued to order them and automakers were left behind.
âThe automakers stopped ordering because they didn’t know what sales would look like,â he said. âWe weren’t selling anything at the time. We had a 30-45 day period without anyone buying cars, it was a scary thing. “
When people order vehicles online from dealerships, the wait times for them to arrive have increased.
Brad Briner, general manager of Shepherd’s Chevrolet Buick GMC in Kendallville, said that depending on the vehicle customers buy, wait times are around three to four months for their new vehicle to arrive from the factory.
âSome vehicles can take up to five to seven months and others can only take two to three months to arrive,â Briner said.
As an incentive, people are currently able to get more trade-in value for their vehicle that they are giving up.
The increased demand for cars has also led to an increase in the value of used cars.
General Motors was hit locally by the chip shortage when the Fort Wayne assembly plant, which produces the Chevrolet Silverado and GMC Sierra pickups, temporarily halted production due to the shortage in early September.
âIf you order a more basic model of truck, you see it in three to four months, but if you order a loaded truck like a Ford F-150 king ranch platinum from our Ford dealership, you are looking at a five to six month’s worth. wait, âsaid Dave Western, salesperson at Burnworth Zollars in Ligonier. “That’s because a new F-150 turntable contains 17,000 chips.”
Ken Cook, co-owner of Burnworth Zollars, said the key to keeping customers happy while they wait for their new vehicle to arrive is to constantly communicate with them about arrival status and give them a realistic schedule.
The lack of inventory has led some potential out-of-state buyers to consider purchasing vehicles from area dealers.
Briner said people as far as California and Arizona have contacted his dealership about sport utility vehicles like the Chevrolet Tahoe or the GMC Yukon because those models are not available in their area.
âThey are willing to pay a lot of money to have it shipped home or even willing to come to Indiana to buy it,â he said. âWe prefer to take care of the people in our garden and preserve the inventory for them. “