We know COVID-19 was the catalyst for the snowball that hit auto and chip manufacturers in the face over the last two years. The result led to a global semiconductor shortage and a reduction of vehicles produced by major auto manufacturers.
Even Volkswagen predicted there will not be an improvement this year in the chip shortage situation. And in China, where most of the semiconductors are produced, their Ministry of Industry and Information Technology expects the supply issues to continue for a long period of time.
Today, the average age of a vehicle on the road is 11.8 years.
Between new and used car prices soaring at a record pace—11.8% increase for new light vehicles and 37.3% for used vehicles—it’s reasonable to assume many vehicle owners will opt to stay in their current vehicles longer than ever before.