2021 was an unusual year for the automotive industry, to say the least. While customer demand for new cars rebounded from the economic uncertainty of 2020, automakers found themselves unable to meet that demand because of semiconductor chip shortages and supply chain problems. So what should car shoppers expect for 2022? Much of the same, unfortunately.
"Competition for new vehicles will be fierce as inventory shortages persist in 2022," said Ivan Drury, senior manager of insights for Edmunds.
Shoppers today must contend with a limited selection, dealership markups, little to no discounts, and a greater sense of urgency to move quickly on a deal. With this in mind, here are five ways that car buying has changed, along with tips on how to manage it.
Ongoing vehicle shortage means higher prices
Vehicles that make their way onto the lot are more likely to be in more expensive trims and either marked up in price or stuffed with numerous dealer-installed accessories that achieve the same effect. You'll also find that dealerships are much less likely to come down on price since they know there aren't many other options available. It's a textbook case of supply and demand.
These days, paying MSRP might actually be a "good deal," relatively speaking. Experts are predicting the chip shortage will last well into 2022 and possibly into 2023.
Tip: If you're in need of a car, we recommend casting your net out farther, as this will increase your options and not every dealership is marking up their vehicles. If you see one you like, be prepared to move quickly — it may not be there the next time.
You're more likely to order your next car
One way to avoid the markups and dealer add-ons is to order the vehicle. According to a recent Edmunds survey, more than half of consumers said they would be willing to place an order for their next vehicle. This ensures that you get exactly the color and options that you want, provided you're willing to wait roughly six to eight weeks.
The basic idea is that ordering a vehicle saves the dealership money on lot fees and insurance. Those savings can then be passed on to the consumer. The "savings" these days, unfortunately, might mean simply paying MSRP and not being charged for dealer add-ons.
Tip: The easiest way to order a vehicle is to use an automaker's website to build the vehicle configuration you want and then send that information to your preferred dealership.