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Wednesday, 03 February 2021 20:12

Chip Shortage Is Affecting Rental Car Orders

Written by Chris Brown, Auto Rental News
Karl Brauer: “Just as production capacity is coming fully back online, we have a major crimp in the supply chain causing a production shortfall that’s continuing to drive up transaction prices for both consumers and fleet buyers.” Karl Brauer: “Just as production capacity is coming fully back online, we have a major crimp in the supply chain causing a production shortfall that’s continuing to drive up transaction prices for both consumers and fleet buyers.” Photo via Wikimedia Commons/Siyuwj.

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U.S. car rental companies are beginning to feel the effects of a global shortage of semiconductors used in automobiles.

A major system licensee had an OEM completely cancel an order of more than 500 units scheduled for late spring and early summer, while another OEM pulled back on 60 orders scheduled for production, the licensee reported.

 

“Most (OEMs) have said ‘We’re monitoring it closely, cuts/changes may be coming,’” the licensee wrote to Auto Rental News. “I think a lot of OEMs just don’t know yet how bad it’ll get.” 

 

The licensee surmised that fleet orders---rental in particular---will be the first to get cut.  

 

A licensee from another system reported that OEM representatives are telling him to expect certain vehicles, mostly trucks and SUVs, to be “significantly delayed.” An informal survey of other rental operators did not reveal further drastic delays or canceled orders, yet. But they all reported they’re monitoring the situation closely. 

 

“At the moment, we aren't getting a lot of information,” one licensee wrote. “I feel like the OEMs aren't sure right now. I'm expecting several months’ delay on vehicles I had scheduled to be built this month.”

 

Wrote a rental fleet supplier: “100% an issue, primarily on SUVs. We are scrambling for product.”

 

On the commercial fleet side, the impact may be felt in longer delays and unexpectedly early buildouts, with the biggest impact to truck and van production. Some truck and van models are no longer orderable, according to a commercial fleet supplier, while ordered 2021 units are scheduled for production into summer and in some cases into the fourth quarter. 

 

Semiconductors that control smartphones and computers are also critical in automobiles, which need 200 to 400 chips. They not only control infotainment systems but also...


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