Leasing Your Way

Extended Lead Times, When do I need to order my new car?

If you order right now a lot of cars are looking up to 6 months lead time plus for a factory order and with limited stock options around, now is the time to get in touch and talk to one of our team. Due to the semiconductor shortage and COVID delays many manufacturers are quoting extended lead times. So don't delay and get in touch today here.

Don't forget you don't have to pay your initial rental until you have taken delivery of your new vehicle!

Why has there been so many delays and extended lead times?
Due to the pandemic back in 2020 car makers around the world began to shut their factories to try and help reduce the spread of the virus. All though it may have helped in the reduction of the spread, this actually caused a chain reaction that has led to limited stock in showrooms and now car companies are openly considering cutting back on the amount of technology they offer in cars.

What are semiconductors?
Now the main reason for the car delays are down to there being a shortage in semiconductors. You may be wondering what is a semi conductor? According to Britannica.com, a semiconductor is “any of a class of crystalline solids intermediate in electrical conductivity between a conductor and an insulator”.

Basically a semiconductor is just a microchip, a tiny piece of technology that helps a lot of the modern world run. They are used in basically everything, from cars and computers to smartphones and even household goods such as televisions.

Why is there a shortage?
To get straight to the point it's just a case of supply and demand. Due to the pandemic causing people to work from home and also children doing online classrooms, the demand for computers, laptops, monitors, web cams and microphones sky rocketed.

Semiconductor manufacturers didn't see this coming as they just presumed the demand would decline as other industries (including automotive) slowed due to pandemic restrictions.  

Semiconductors are mainly produced in countries such as Taiwan, South Korea and China. These countries have been hit just as bad as every other country by COVID-19 and they have also needed time to recover.

What do semiconductors have to do with cars?
There are many problems for the car industry. The first being that many brands began to cut back on their semiconductor orders in the early stages of the pandemic, predicting that there was going to be reduced sales. All though car sales still remained as popular as before as people were wanting to avoid taking public transport or spend their money on a new car instead of a holiday.

All though all industries have been effected by the chip shortage, the difficulty for the automotive industry is that cars don’t rely on just one type of semiconductor, it needs both the latest versions for things like infotainment as well as less-advanced ones for components like power windows.

When will it end?
That depends on who you listen to, as it is all just predictions. Some believe we have been through the worst of the shortage and others are warning that it will run into 2022.

The head of Volkswagens procurement, Murat Aksel, has told Reuters in June that he predicts that the worst period will be over by the end of July. 

On the contrary, at the time of publication, other industry experts are tipping that the supply shortage could actually worsen in the second half of 2021 and create further production delays for car makers.