COVID Causes Auto Inventory Shortages

February 17th, 2021 by

COVID has caused automotive inventory shortages across brands and borders. Kia is among those experiencing inventory issues.

kia manufacturing

Kia’s 2,200-acre plant in West Point and local suppliers employ 14,000 people, according to the car company.

Chronic shortages are being caused by a number of factors:

  • Shutdowns of manufacturing operations
  • Shortages of critical and non-critical parts and components
  • Interruptions to the supply chain
  • Transportation delays

We are seeing problems across the industry. Many manufacturers are having issues with computer chip shortages. Cars cannot run without them. In some places, inventory is stacked up at ports and train depots with no trucks available for loading.  Even the smallest, most insignificant part can prevent production from being completed.

Shortages are not only impacting vehicle inventory and sales, but service and parts operations as well. Parts backlogs are impacting customer repair and maintenance.

Kia Country General Manager, Steve Appelbaum says, “We do not have the inventory to meet demand. We have about 50% of our normal new vehicle inventory.”  How does this impact customers? Customers are making buying decisions more quickly because existing inventory is selling quickly. Used car prices are also rising as demand is shifted to pre-owned inventory.

The silver lining? Dealers need pre-owned inventory to fill the void which is driving up trade values. In other words, it is a great time to sell or trade your vehicle.

Experts believe it will be mid-to late summer before manufacturing fills the void.  We all thought things would be back to normal by now; when in fact we are still working with ongoing constraints and shortages in all aspects of our lives.