As carmakers and dealers scramble to source vehicles, brokers and financiers are stepping in to provide frustrated consumers with purchasing and finance options.
The current automobile shortage is affecting all corners of the globe, creating wait times of up to 12 months for new vehicles and driving up second-hand prices.
According to Toyota, Australia’s most popular car brand, every vehicle in its range has been affected. Volkswagen has set up a dedicated website so exasperated consumers can search the company’s stock database and locate the few cars that are available.
“This shortage is worldwide, and it is affecting all makers,” says Kaine Ransom, director of Automotive Vehicle Brokers Australia. “You can’t single out certain classes of vehicle – like hybrids – or even certain brands, because this problem is so widespread.”
What is causing the shortage?
As Ransom explains, it’s a confluence of factors. “A semiconductor shortage is fuelling this significantly,” says Ransom. Today’s cars each contain up to 100 semiconductors to help power everything from touchscreens to crash-avoidance technology. “Oddly, there are very few manufacturers of semiconductors globally, and one of the factories recently burned to the ground,” he notes.
A shortage of magnesium, which is used in many of the aluminium alloys that carmakers rely on, is compounding the manufacturing problem.
Staffing and distribution problems come into play, too. “The pandemic has been shutting down factories intermittently,” says Ransom. “That pushes back production but companies are continuing to accept orders, which has created these waitlists.”
The pandemic has crippled the global shipping industry, too. Specifically, a shortage of staff on the docks has slowed down the unloading of containers.
Act or wait?
“Unless you work with a broker, it’s going to take a lot of legwork” says Ransom. His brokering business, which primarily works with doctors, is fielding an increasing number of calls.
“We all know that doctors are time-poor,” he says. “They just want a deal and to get it done. At a moment like this, with a shortage, brokers can save you a significant amount of time.”
Ransom’s key piece of advice, whether you use a broker or not, is to be flexible if you’re not keen to order and wait. “Australia hasn’t run out of cars yet,” he says. “If you’re happy to compromise and look at different models and finishes, it’s possible to pick up a car today.”
He says that the recent slow-down in car sales has generated competition in the lending space, which means there are attractive financing options at present.
Even so, there’s an argument to be made for simply waiting six months or so to upgrade your car. But Ransom reckons that’s a mistake. “We’re in such a mess that it’s going to take quite some time to clean everything up,” he says.
“If you wait six months, you may have fewer options, or you may end up joining the end of a waitlist that you could have jumped on earlier.”
Seizing the day
Finding a car right now could be tricky, but finding the right finance doesn’t have to be.
At Kooyong, we compare finance options from our network of lenders who understand doctors’ needs and creates customised solutions for our clients.
We create plans tailored for business, personal or mixed use; devise repayment options to fit your cash-flow; and offer a range of finance types, from chattel mortgage to hire purchase, lease and novated lease.
Importantly, we move quickly. At a time like this, we understand that you won’t relax until you get your new vehicle home. We’re here to help you seize the day.
Kooyong is Avant’s lending partner. Call us at 1300 99 22 08 or email
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