Waiting for Wheels

Dealers’ lots thin out as supply issues cripple the auto-manufacturing industry
Car dealerships across the city have been dealing with low inventories and empty lots.

Looking to buy a new minivan or SUV? Buckle up for a long wait.

Edmonton-area car dealerships are reporting wait times of up to a year for new vans and other vehicles as they grapple with unpredictable delays in supply.

Sales inquiries to several Edmonton car dealerships selling popular domestic and imported vehicles – such as Honda, Subaru, Toyota, Ford and Chrysler brands of vans and SUVs – turn up wait times of several months to a year for new products, depending on chosen options.

One Toyota dealership estimated up to a 12-month wait for a new hybrid Sienna, while a Honda dealer said there’s an average six- to eight-month wait for a new Odyssey or Pilot. And the occasional new family van or full-sized SUV that does come available could run a buyer $60,000-$70,000. Online car forums report some of the longest waits for the new Sienna, with some buyers who have preordered the vehicles claiming they’re having their delivery dates repeatedly pushed back.

Gerald Wood, president of the Motor Dealers’ Association of Alberta, says the industry is facing a “frustrating” situation that’s impacting what used to be the fairly quick and straightforward exercise of buying a new vehicle.

He cites a “massive” global shortage of microchips as one of the main drivers of constraints in vehicle production. ”That has controlled how many vehicles can be produced,” he says. “Just as we were expecting to take advantage of the pent-up demand gathered during COVID, we started running into all these component issues.”

The chip shortage is so acute that in late October, Toyota announced it would give new car buyers just one smart key instead of two in a bid to ration semiconductors.

“It’s been really frustrating for our dealers to get good information for the customers, too, because the manufacturers are literally living hand to mouth with these components and sometimes the information isn’t nearly as accurate or robust,” Wood says. “And that makes it very difficult for a dealership to keep the consumer informed of what the status of their vehicle actually is.”

One Edmonton dealership said in normal times more than 100 vehicles would land on its lot each month. Now it’s only getting 15 in the same time frame, and the staff never quite know how many might show up.

“If a car carrier showed up with eight vehicles on it, seven of them were probably pre-sold,” Wood says. “There just hasn’t been any stock.”

The limited supply of new vehicles has also pushed up prices in the used vehicle market, which was good for people looking to sell or trade in their vehicles, but painful for those looking to buy a used car.

Canadian sales figures for 2022 are expected to be down 15 per cent year over year, Wood says. Now, dealers are closely watching rising lending rates, which will impact sales as it becomes more expensive to finance a car.

“Softening of consumer demand is never good,” Wood says. “That always makes folks a little sleepless.”

For those hoping for a less suspenseful car buying experience, Wood sees hope on the horizon.

“We’re seeing production numbers increasing again, and inventories building. Where you might have seen three or four vehicles on a lot, you’re seeing 10 to 15 now.” With production ramping up and demand easing, he expects things to be somewhere near normal by the second half of 2023.

How difficult things will be for buyers until then depends on customer patience. “Buying a vehicle is a fairly emotional purchase and sometimes, when you have to wait for extended periods, that emotional rollercoaster can be a challenge,” Wood says. “Having to wait months to actually take delivery changes the dynamic of the decision.”

“If you’re prepared to wait that long and plan that far out, you can usually manage through things pretty effectively. But that’s not typically the way people make a decision on purchasing vehicles.”