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Clint Newell, owner of Clint Newell Toyota, poses for a photograph at his Roseburg car dealership on Friday.

Anyone driving by car lots these days may notice one common theme — sprawling lots with very few cars.

A national car shortage driven by slowed production and a shortage of semiconductor chips necessary for making new cars has caused some dealerships to look like ghost towns.

For Clint Newell, owner of Clint Newell Toyota and Clint Newell Chevrolet, the car shortage has impacted his new and used car sales.

“It all started in the spring of 2020 when global auto production was shut down for two months,” Newell said. “You had a 60-day period when no new cars were being built.”

This caused the inventory at car lots to diminish. When car manufacturing started up again, production rates couldn’t catch up making it harder to replace vehicles that had sold.

“We hit a point this year where basically everybody ran out of cars,” Newell said.

Even though Newell has begun receiving more car shipments, he noticed that the supply and demand remains unbalanced.

“Right now there tends to be more buyers than cars available,” he said.

Now more buyers are heading to used lots, which comes with its own set of challenges. Prices of used cars continue to surge with last month jumping by 10.5% — the largest monthly increase on record, according to a report from the Associated Press.

And for used car dealers like Dale Roth, owner of Dale’s Used Cars, the shortage of new cars has caused more competition at auctions that are driving up costs. Roth has seen more new car dealers at auctions attempting to counteract their shortage of vehicles.

“There are fewer cars to go around as people aren’t trading them in as much and buying new cars,” Roth said. “So there’s less used cars for me to buy at auctions.”

Roth has seen availability for cars at auctions decline significantly. Prior to the chip shortage, he would buy 12 cars a week, but now averages about four a week, he said.

“There are still quite a few cars, but there seems to be less of what I really want,” Roth said.

The surge in used car prices can also be contributed to rental car companies desperately trying to restock lots that were sold at the start of the pandemic. Vehicle rental prices have skyrocketed by 90% in the last year alone.

While the AP reports prices have begun to decrease at wholesale auctions with demand decreasing, Newell doesn’t believe the situation for new cars will change anytime soon.

“I think it’s going to be quite a while for the manufacturing rate to exceed the sales rate,” Newell said.

Madison Temmel is the Charles Snowden intern at The News-Review. She can be reached at mtemmel@nrtoday.com and 541-957-4217.

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Madison Temmel is the Charles Snowden intern at The News-Review. She can be reached at mtemmel@nrtoday.com and 541-957-4217.

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(1) comment

CitizenJoe

It's critical to solve this chip shortage, both for vehicles and almost all elements of our economy. There's $50B in Biden's infrastructure package for research and development of chips.

Similarly, battery R&D could use a boost (you should pardon the expression); EV sales will soon demand more batteries than the world can quickly produce. (According to a Bank of America Global Research, as early as 2025.)

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