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Motor dealer warns car stocks could run low while chips are down

A Swindon motor dealer is warning of a shortage of new car stock across the UK – because of a worldwide shortage of microchips.

Global demand for semiconductors outstripped supply last year as locked-down consumers invested in laptops for home-working and home-schooling, and games consoles and televisions to keep them entertained. 

The semiconductor shortage had a knock-on effect for motor manufacturers around the world, who use microchips in their onboard management systems. 

Last month Honda's Swindon manufacturing plant closed down for four days, as did car plants across the globe owned by Audi, BMW, Fiat, Ford, Mercedes-Benz, Nissan, Subaru, Toyota, and Volkswagen group – which has said it will make 100,000 fewer cars this quarter as a direct result of the shortage.

And as car dealers in the UK prepare to emerge from lockdown, the effects of production delays are being felt.

"Modern cars – especially electric vehicles – are like computers on wheels," said Dominic Threlfall, managing director of Hyundai and Suzuki franchise Pebley Beach.

"The motor industry is anticipating a release in pent-up demand when showrooms are allowed to open again after lockdown, but the rush for the most popular models at a time when stocks are low means that some customers might be disappointed."

To secure the new car they want, Dom advises motorists to put down a deposit before showrooms reopen. 

"In the Swindon and Cirencester area we are blessed with almost all the manufacturers and all the companies are long-standing trustworthy businesses, and many offer a fully-refundable deposit scheme, so there's really nothing to lose," he said.

"A deposit will at least reserve you a car until you can have a test drive and make your commitment decision."

Pebley Beach offers a £99 fully refundable deposit on all models of Suzuki and Hyundai cars. 

For motorists who are happy to wait, the good news is that major manufacturers think supplies will be back to normal by the end of the year – although the laws of economics mean that the rising cost of the tiny but vital microchips might have an effect on the overall price of a new car. 

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Financial Disclosure

Pebley Beach Limited is an Appointed Representative of Automotive Compliance Ltd, who is authorised and regulated by the Financial Conduct Authority (FCA No 497010). Automotive Compliance Ltd’s permissions as a Principal Firm allows Pebley Beach Limited to act as a credit broker, not as a lender, for the introduction to a limited number of lenders and to act as an agent on behalf of the insurer for insurance distribution activities only.

We can introduce you to a selected panel of lenders, which includes manufacturer lenders linked directly to the franchises that we represent. An introduction to a lender does not amount to independent financial advice and we act as their agent for this introduction. Our approach is to introduce you first to the manufacturer lender linked directly to the particular franchise you are purchasing your vehicle from, who are usually able to offer the best available package for you, taking into account both interest rates and other contributions. If they are unable to make you an offer of finance, we then seek to introduce you to whichever of the other lenders on our panel is able to make the next best offer of finance for you. Our aim is to secure the best deal you are eligible for from our panel of lenders. Lenders may pay a fixed commission to us for introducing you to them, calculated by reference to the vehicle model or amount you borrow. Different lenders may pay different commissions for such introductions, and manufacturer lenders linked directly to the franchises that we represent may also provide preferential rates to us for the funding of our vehicle stock and also provide financial support for our training and marketing. But any such amounts they and other lenders pay us will not affect the amounts you pay under your finance agreement, all of which are set by the lender concerned. If you ask us what the amount of commission is, we will tell you in good time before the Finance agreement is executed. All finance applications are subject to status, terms and conditions apply, UK residents only, 18’s or over. Guarantees may be required.