Local car dealers work through inventory shortage

A computer chip shortage is slowing down deliveries
Car Shortage
Posted at 7:32 AM, Jun 15, 2021
and last updated 2021-06-15 07:32:07-04

CUYAHOGA FALLS, Ohio — The last 15 months have been a roller coaster for the auto industry.

In March of last year, people were buying cars and the inventory was high.

Now, auto dealers don't have enough cars to meet the demand and local dealers are feeling the impact of a global economy.

"When it was first coming out, it seemed like there would be no cars for a year," said Josh Obenreder. "The first day I saw two cars, all I could think was everybody driving past thinks we're going out of business."

Obenreder has been at Cascade Auto in Cuyahoga Falls for about three years. This was the first time he saw the show lot empty.
At the lowest point, Obenreder said he fielding a few calls worried about the dealership.

"Where's all your cars?"

Cars are in low supply after a computer chip shortage. A fire at a factory earlier this year and a move in 2020 to focus more on computer chips for gaming consoles instead of cars, there are not enough computer chips for cars needed now.

"We've been getting curveballs almost every other month," said Pat Primm.

But now, things are starting to even out.

"This is a beautiful thing. We love it," Obenreder said staring at a lot with more cars than earlier in June. Earlier this month, General Motors announced it would ramp up production. The Subaru manufacturing plant in Indiana, where Cascade gets its cars, is expected to follow suit to meet the demand of drivers.

"Our goal is to sell 80 Subarus a month," Primm said. "Last week, if you were here, we would have had two cars on the ground, which makes things a little difficult."

The auto industry is sales-driven. With no cars to sell, the Cascade Auto employees had to pivot. They are now taking more orders for cars instead of being able to sell them off the lot.

"In that regard a little bit, you're selling kind of a phantom of a car," Obenreder said.

They are also telling customers it could be several weeks before the car they ordered comes in.

Acknowledging the downturn in sales during a usually busy time, leaders at the dealership changed course with time off.

"This year, we said, look, there's nothing here," Primm said. "If you have vacations in the bank, why don't you think about going and taking that summer trip."

Primm said the auto industry saw the chip shortage coming. He thinks the imbalance will be righted soon.

"Each brand is a little different. Subaru assures us that probably by August we'll be back to normal levels," he said.

Joey Huang, with the Greater Cleveland Auto Dealers Association, is seeing a similar timeline.

"I think that some manufacturers have better relationships with their suppliers and those manufacturers will come back quicker and some maybe into 2022."

The trickle-down of the chip issue and car shortage is felt by consumers. Used cars are in short supply, too. New numbers from the Consumer Price Index show a 29.7% increase from a year ago. But analysts expect prices to even out when the chips start shipping which is good news for Obenreder

"I'm truly used to about a 115-car inventory, but this is really nice to see," he said standing in the lot. "It's a change of pace. And I don't have to take my one Forester and my one Outback and angle them to make it look like I have more inventory."

RELATED: Political spat over vaccines between China and Taiwan could make global computer chip shortage worse