Just 40% of buyers willing to downgrade vehicle specification due to microchip shortage
This is the latest report in a series of weekly updates for industry colleagues from Rachael Prasher, managing director of What Car? and Haymarket Automotive. Quoted poll data is from more than 1900 whatcar.com users.
Last week’s manufacturing figures from the Society of Motor Manufacturers and Traders (SMMT) showed an industry in recovery and the next monthly new car registration figures, out this week, are expected to show another strong performance in May. However, the upturn is at risk due to the ongoing global microchip shortage.
The microchips affected are required for many of the infotainment, camera and connected features fitted to many modern cars and most manufacturers are now affected by the shortage. Ford has already confirmed it will produce 1.1 million fewer vehicles this year due to the issue, while others such as Audi furloughed 10,000 staff earlier in the year to reduce vehicle production.
Manufacturers have also started to adjust vehicle specification levels, with certain technical features now often reserved only for the highest trim ranges.
To find out how aware consumers are of the shortage, and how willing they are to wait for their next vehicle, What Car? polled 1920 in-market buyers as part of its latest research.
Of those surveyed, 58% were aware of a shortage potentially affecting vehicle lead times and vehicle specification levels, while just 40% said they would be willing to buy a lower specification car than initially intended. With nearly two-thirds of buyers unwilling to downgrade, this could place added pressure on existing stock.
More than a third (38%) of new car buyers also expect to receive their new car within eight weeks of signing on the dotted line, with 35% prepared to turn to the used market if their vehicle cannot be delivered on time.
That last finding is significant, as it is set to add further pressure to an already inflated used car market, pushing up prices of nearly new vehicles even further.