The leasing sector is seeing a significant rise in ‘in-stock’ vehicle enquiries as the widespread shortage of semiconductors continues to impact the manufacturing of new cars.
Car retailers are benefitting from the new strategy, according to Leasing.com, as it enables them to clear existing stock that has been sat on forecourts during the lockdown closures.
Paul Harrison, head of strategic partnerships at Leasing.com, said: “More recently, consumer demand has switched to in-stock vehicles as a result of current production issues and this has helped our dealer and broker partners who have been able to access stock, meet in-market consumer demand and help their bottom lines recover from the disruption of the pandemic.”
Leasing customers typically order their vehicles directly from the factory to the exact colour and specification of their choice, but with ongoing delays and the resulting increase in waiting times for new vehicles, Leasing.com says consumer behaviour is changing.
In April 2021 global lead times on vehicles almost doubled from more than 12 weeks in February to 22 weeks1. This dramatic shift caused some leasing consumers to cancel factory-ordered vehicles in favour of in-stock models already built and shipped to the UK. Data from the UK’s biggest leasing comparison website shows that during April, in-stock orders were up 7% on factory orders in comparison to 2019 when factory orders were 27% higher.
This increase has come at a good time for UK dealerships, with many having stockpiled vehicles ahead of Brexit, and with lockdowns closing forecourts until April 2021, stocks have lasted longer than they would have in a normal market.
The semiconductor shortage has, however, also impacted the used car market. With many models backlogged until the end of the year, consumers are looking to make their money go further if they can’t get exactly what they want in the new car market. The used car market has consequently seen demand surge, leading to prices rising, with some models seeing 10% added to the value.
Harrison added: “At the start of this year, our YouGov research showed that 18% of UK motorists expected to replace their car in 2021. That research has proven correct with new car demand on our website increasing each month this year.”