Those in the market for a new car may be experiencing a difficult time pick one out as the auto industry is currently suffering from a pair of problems.
A relatively new issue is the shortage of a critical piece of technology for the production of new vehicles: microprocessors.
Mainly made overseas, these microchips are as important to a vehicle as a muffler or engine. It can take up to 500 chips to keep a vehicle going.
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Dan Hearsch, Managing Director at AlixPartners, told News Center 7′s Michael Gordon that the shortage of the microchips is impacting auto makers, suppliers and consumers.
The international shortages have caused auto makers in the United States to find a way to produce chips domestically, something Hearsch said should be done regardless of the current problems.
“There is no good reason not to have these parts made in the United States versus Taiwan or China because they are not labor-intensive,” Hearsch said.
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The second issue within the auto industry is the widespread car inventory shortage.
Jeff Reichard, Vice President of Reichard Buick GMC, said the industry shortage is a worldwide problem.
In the United States, though, Reichard said every manufacturer is dealing with the issue.
The shortage has even caused an increase in transaction costs, with pickup trucks and sports cars seeing the largest increase.
Industry insides said the shortage should be sorted out by September.
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