Jul. 30—The car lots at Owensboro dealerships, like those across America this summer, have an abundance of parking spaces and a shortage of vehicles.

John Moore, president and chief executive officer of Don Moore Automotive, says he has 700 fewer vehicles on his various lots at 4216 Frederica St. and 3232 Villa Point than he usually does at this time of year.

Jerry Ray Davis, owner of Jerry Ray Davis Chrysler Dodge Ram Jeep, counted 58 vehicles — including commercial vehicles — on his lot this week.

He would normally have 200 or so, he said.

And Duke Brubaker, general manager and president of Champion Ford Lincoln Mazda, was down to 22 new vehicles.

He usually has 150, he said.

It's another of those problems created by the coronavirus pandemic.

The semiconductor chip shortage began when factories in Taiwan and China closed last year to try to stop the pandemic.

And they still haven't caught up with demand.

Car and Driver says, "New-car sales in June were down around 14% compared to pre-pandemic numbers from 2019, according to the data and analytics team at Black Book. It's likely to get worse in the near term, as the number of new vehicles available in the marketplace has dropped substantially and production still hasn't caught up to demand."

Semiconductors are the tiny electronic switches that run computations inside computers in cars, cell phones and other electronic devices.

And the shortage of new cars that are waiting for their chips has driven the price of used cars through the roof.

Used car prices way up"Used car prices are up as much as 20% this year," Moore said. "If you're trading in, that's good because you get the higher price. And new cars are only up 3% to 4%."

He said, "Used car sales are down. It's not a good time to buy if you don't have a trade-in. But as inventory picks back up, prices should drop back down. It's tough on people right now, but as things normalize, I think prices will come back down."

"Used car sales are up because people can't find new cars they want," Brubaker said. "But there's been a steep increase in used car prices. We've bought cars back from people for more than we sold them for."

Tommy Tapp Jr., general manager of Tapp Motors, said, "Used vehicles are a little pricey. I've seen wholesale prices on trucks that are where retail prices should be. We stick to our guns and don't pay that. But a lot of dealers are paying anything."

He said the rising prices haven't "really affected us. We've been around so long that we have a lot of good sources. Our inventory is about where it always is."

Davis said with fewer new vehicles on his lot this summer, "we're stocking more used cars than we usually do. We offer a warranty for life on certified pre-owned vehicles."

He said, "The prices of used vehicles have skyrocketed this year. The wholesale prices on some of them are more than the new vehicle price was when they were sold in 2018-19. But banks are offering better rates and better terms. Now is definitely the time to trade in on a new vehicle if you can find what you like in stock."

People driving I-71 between Louisville and Cincinnati can see thousands of Ford trucks parked at the Kentucky Speedway. And they wonder why they're not on dealer lots.

Brubaker said those trucks are waiting for chips, so they can be sent to dealers.

"A car may have 500 to 1,000 chips," he said. "One module may have 300. There's talk about shipping us the vehicles and then sending us the modules that we can plug in ourselves."

Moore said, "I have 140 Toyotas due in the next two months. They're starting to come back. Chevrolet and Honda are still bad. But most of the others are coming back."

He said new car sales are up 40% this year on his lots.

"I'm preselling them and they're gone as soon as they hit the lot," he said.

Brubaker said, "We have a lot that have been preordered. Those will come in first, so our lot won't fill up very fast."

Davis said, "The factories have cut our allocations. I have no idea when it's going to improve."

Moore said, "Things should be better by the fourth quarter. But I expect it will be 2022 before things are back to normal."

Brubaker said, "Most lots won't look normal until the first or second quarter of next year. We have a great dealer trade network where if I don't have what the customer wants, I can find it on another dealer's lot and trade with him. But that's non-existent now. I was told it would be 120 days from July 1 before we could get some cars."

Cox Automotive, whose website says is one of the country's leading communications, media and automotive services companies, said, "Used-vehicle sales have slowed since April when the market saw the best retail sales month in history. The pace in July has slowed so that the month is likely to end down compared to 2019, which was the strongest year for used retail sales."

Price increases have slowedIt added, "Retail price increases in recent weeks have slowed to the smallest gains recorded since prices began to rise this year."

But it said, "The average listing price for used vehicles surpassed the $25,000 mark for the first time — $25,101 to be exact. That compares with $24,414 a month earlier. Only a year ago, the average listing price hit the $20,000 mark. It has been rising ever since. The average listing price was 26% higher than the end of June 2020 and 29% higher than 2019."

A report by Black Book said that new-car sales for June were down about 14% compared to 2019. This was the first month where the shortage affected actual sales."

CNN reported recently that "the global shortage of semiconductors that has hobbled the auto industry and made some consumer electronics more expensive could last until the middle of 2023, Intel has warned."

The Motley Fool reported that "Taiwan Semiconductor, the largest foundry in the world, greatly increased its output of automotive chips last quarter, up 12% over the prior quarter, helping to ease the shortage of automotive microcontrollers that caused widespread shortages and work stoppages at global carmakers. TSM management now says the company is on its way to increasing its auto chip capacity by 60% this year."

Keith Lawrence, 270-691-7301 klawrence@messenger-inquirer.com

270-691-7301

klawrence@messenger-inquirer.com