NASHVILLE, Tenn. (WKRN) — Starting in November, General Motors said all of its North American plants that were closed due to a global microchip shortage will reopen – though some factories will only run one shift per day.
In the meantime, cars sit like ducks, waiting for their chips. It’s all due to a bottlenecked supply chain that’s not only impacting the sale of cars but also car parts.
“It’s impacting us just like it has every other business in the country,” said Steve Bass, owner of Bass Tire on Nolensville Pike.
Thankfully, Bass got ahead of the broken supply chain before it truly fell apart.
“We kind of anticipated some parts issues, so we ordered pretty heavy at the first of the year, oil filters, air filters and those kinds of things. So, we’ve been able to sort of dodge a bullet.”
But, that doesn’t mean they’re out of the clear. Bass said they’ve had some customers park their cars for weeks, waiting for parts to come in. Bass admitted for others in the auto industry, it’s a lot worse.
“Think about cars in the U.S.; Cars are being made. They just don’t have the actual microprocessors, the chips, to be able to get them into showrooms,” Bill Thayer said, Co-Founder of Fillogic, a New York-based technology company that provides retail and logistics services.
In some cases, finished chips are taking more than 50 weeks to get to an automaker after an order is placed.
Under normal circumstances, it should only take around 16 weeks.
As a result, vehicles sit, waiting for chips, leaving some dealerships to deal with near-empty lots.
Bass said during the COVID-19 pandemic last year, many car manufacturers didn’t buy enough chips ahead of time creating a backlog. “They could build the cars, but they couldn’t get them ready to ship because they didn’t have the chips.”
You may remember, the Nissan plant in Smyrna ended up shutting down for weeks due to a COVID-19 outbreak at a chip supplier overseas.
“Nissan has adjusted production schedules within our North American manufacturing operations due to semiconductor-related parts supply. We continue to work closely with our supplier partners to assess the impact of supply chain issues and minimize disruption for vehicle deliveries to our dealers and customers,” Lloryn Love-Carter said with Nissan Group of the Americans Communications.
The problem here is we have more demand than supply and that opens the door for inflation, something that Bass said is hitting the automotive industry very hard.
“The problem is so many products we use are not made in America,” Bass said. “A lot of the products we buy that go into automobiles are built overseas and overseas factories. So, getting them from those factories to our ports has been a problem.”
Automakers are now seeing shortages in wiring, harnesses, plastics, glass and in some cases, tires.
“Sometimes you take the hand you’re dealt and try to deal with it the best you can,” Bass said. “Let’s all work together, and we’ll get through this thing.”
News 2 continues its in-depth coverage of the stressed supply chain in the wake of the COVID-19 pandemic. Keep up with the latest information as we head into the holiday season with our reports ‘Supply Chain SOS.’
Autoforecast Solutions expects 7.1 million fewer vehicles to be produced in total this year due to supply chain issues.
Record-high consumer prices for vehicles could extend well into next year, experts said. Adding that they may not fall back until 2023.