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Experts say chip shortage will linger for several more months, encourage research before buying vehicle in 2023

10TV looked into how Central Ohioans can keep an eye on their wallets before reaching for some new keys.

COLUMBUS, Ohio — At the start of the new year, a lot of people may be looking into new or used vehicle prices, but the pandemic brought on supply shortages, some of which are sticking around and affecting vehicle sales.

One of the major supply chain shortages that was ramped up during the pandemic was in the computer chip industry.

Most newer cars on the market need a chip to run their more advanced functions. 

In the past year and a half, they have been harder to come by.

Ricart Automotive President, Rick Ricart is dealing with the continued chip shortage and has been for the past two and a half years.

“It was very difficult for many of our customers,” Ricart said. "In the summer of 2020, we started to see that inflation happen in the prices. It peaked at almost 26% over where the market should’ve been on used cars.”

People in the market for a new car felt those costs too, and when they tried to go for a used one instead, Karl Brauer, an analyst at ISeeCars.com said dealers saw an opportunity.

“Dealers knew that people really wanted the car, so, of course, they’d be like ‘well, I’m going to need x amount of dollars for that one.’ So you really had the price of used cars driven up by this constriction of new car production.”

Brauer said a shift in consumer demand away from cars and pandemic related lockdowns across the country put the chip shortage in high gear.

The United States is in a better place now, but other countries like China are still seeing periodic lockdowns, keeping workers from factories that may produce those chips.

Electric vehicle production is contributing to the shortage too.

EVs are even more dependent on computer chips than fossil fuel powered cars, limiting their supply and making them more expensive.

“We’re getting through it and it’s slowly improving, but unfortunately, demand in and out of the auto industry has shot up so much that there’s just no way to catch up now, not with the current production capacity,” Brauer said.

He said the country will likely be stuck in this shortage until the end of 2023, but if someone feels they have to buy a car, they should know that features like wireless charging, which are not imperative for a car to run, are being constrained.

Brauer also noted people should know what exactly they are looking for, do their research online, track prices and call dealerships ahead of time to find out if the car they are seeing on their website is the one that will be seen on their lot.

He also said people also often can find a deal if they are willing to drive farther away than they normally would.

“It’s very likely that if you don’t have to buy today, and you can wait one, two, six months, it’s very likely whatever you’re looking for will be lower priced.”

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