As per the 2020 research report published by the Australian Industry and Skills Committee, the automotive industry is expected to contribute $37 billion to the Australian economy. This shows that the automobile industry is gradually on its way to become a billion-dollar industry and it’s easy to see why. Whether you’re interested in new car models or planning to buy a second-hand vehicle, the freedom of getting behind the wheel of your vehicle is something that everyone can appreciate.
However, there are numerous facts about cars that most people don’t know. There’s a massive shortage of brand-new cars so let’s deep dive and know the reasons.
Why is there a Scarcity of New Vehicles & Its Impacts
The world of cars is a complicated one. There are so many different types of cars, car parts and car accessories to choose from that it can be easy to get overwhelmed. And let’s not forget about the rules and regulations that go with owning a car in your particular state or country! (Don’t even get us started with Thailand driving rules)
This blog post will cover some important things you need to know before buying a new car.
Are you interested yet? We hope so because we have five compelling factors for you to consider when buying a new vehicle. If you read on, we promise this won’t be boring! In fact, it might even make your life easier since these tips could save you time and money in the long run.
1. Delay in new vehicle delivery resulted in hiked prices: There’s a shortage of brand-new cars because of the pandemic and strong bounce-back economy, but you may have even received your dealership call asking to buy the vehicle. The price for new vehicles has gone up by 5%, while used car prices are 45% higher than they were in 2020!
2. Expensive inventory: The deficit of new car models in Australia is a situation that has been going on for quite some time, frightening automakers that they might have to be left behind to hold an expensive inventory while the pandemic-induced lockdown had stopped production and cancelled orders. As a result of this innately developed fear, many sellers are taking a few steps backwards when it comes to introducing new cars to their inventory.
Also read: What are the Most Useful Accessories for Every Car?
3. Few latest model cars: It is a well-known fact that people are always looking for the latest and trendiest car. With so few new models coming out every year, there were shortages all over. According to the reports of The Federal Chamber of Automotive Industries (FCAI), the primary body for the automotive industry in Australia, there were more than 11 million new cars sold in Australia between 2011 to 2020. Not only that, but the report also states that new cars for sale in Australia has never been so low since 2003.
Dealers had deals which they weren’t going to share with anyone else – despite their best efforts at marketing towards us “car lovers” who want nothing more than an awesome ride.
4. Trade Wars: When the chip shortage was at its worst, many people were searching for new cars with less of a feature set. To keep up the production and avoid missing deadlines, car manufacturers have had some minor imperfections corrected on certain models, for example, removing automatic stop-start from some vehicles.
This is done in response to the recent economic crisis within America’s auto industry caused by economists estimating that 1 million lesser cars will be created this year. That’s because there are not enough brand-new parts being manufactured or imported into our country.
When you look past all these negative headlines about trade wars, you realize only one thing – it has been happening since decades ago!
5. Restriction for the transport sector: The automobile industry is currently experiencing a deficit. This means that there are not enough brand-new cars for all who want them, and it has several consequences when shopping locally or abroad as prices are likely to skyrocket as supply meets demand (and buyers with less choice pay more).
It also affects down payment amounts since it becomes difficult to purchase anything other than an expensive high-end model.
The transport sector in particular has been affected by these problems – due to both financial constraints imposed on its stakeholders and reduced government funding in tandem with stagnant consumer sentiment over recent months. These challenges have led us back into something resembling a crisis mode where everything feels unstable without any real solutions.
Also read: Top 10 Car Mechanics in Victoria
The automotive industry is undergoing a major transformation. With the delay in new vehicle delivery, high inventory prices and shortage of latest model cars, many car buyers are finding themselves frustrated with their choices. To make matters worse, there’s also been an increase in trade wars and a decrease in new car models in Australia that has restricted the transport sector. However, this doesn’t mean you’re out of options! If you need parts or supplies for your current fleet but can’t find them locally, post a request on Swezo today to get connected to suppliers who can help you get back up and running fast at affordable rates. It only takes a few minutes to register so what have you got to lose?
