Make / Model Search

News - Market Insight - Market Insight 2022

Pandemic bites some brands in January

Delays: As delivery times push out to nine months, hot-selling models like the Kia Sorento now trickle out of showrooms.

Some models hit by supply chain kinks and other pandemic-related dramas in January


Click to see larger images

25 Feb 2022

FEW data points show the effect of COVID-19 from a factory perspective than individual model sales, particularly across brands that have different exposures to the way the pandemic has hit different sectors of the vehicle supply chain.


In the case of some unlucky models, COVID-19’s tentacles adhered to more than one link in the chain, striking at the labour level on the production floor, the supply of components (including semiconductors), shipping schedules, access to last-mile delivery sources, and dealership opening times.


For others, only one hit crimped production and supply; usually the ability to find semiconductors.


When COVID-19 struck, dealers initially shut shop and buyers stayed away. Then the need for personal transport brought a surge of interest in a car – new or used – that provoked unprecedented demand.


At the same time, expecting diminished orders on the back of the pandemic, car-makers curtailed orders from their suppliers, including components such as the semiconductors used to control everything from communication devices to brakes, which number from 300 to 3500 per vehicle.


With cancelled orders, semiconductor manufacturers changed the focus to other electronics, including personal items such as mobile phones and computers that were surging in demand due to the shift to remote working.


By the time car-makers realised car demand was booming, the chip-makers had moved on.


The pandemic then expanded its reach by hitting more workers in plants and at suppliers’ factories, growing in spread and strength through mutations – Alpha, Beta, Delta, Gamma and Omicron to date – resulting in substantial production shortfalls.


For Hyundai, Kia and Toyota – as an example – the effect has hit at production and pushed out vehicle delivery times.


Toyota’s LandCruiser 300, for example, has a wait time of up to eight months in Australia and four years in Japan, while Australian wait times for the Kia Sorento SUV are now about nine months and Hyundai Santa Fe about seven months.


The result is seen in the sales. Santa Fe results for January this year were down 62.2 per cent on the same month in 2021 while the Toyota LandCruiser wagon is off 51.3 per cent.


Some have so far escaped the pain, including most of the Chinese car-makers, manufacturers of vehicles with limited chip numbers (notably North American pick-ups), and companies such as Mazda that has done well to avoid long delays.


The Mazda2, for example, has lifted sales by 34.5 per cent while the popular CX-5 SUV is up 54.4 per cent on a January 2022 to January 2021 comparison.


Particularly hard hit car-makers include Jaguar Land Rover, which was one of dozens for which shipments to Australia were halted mid-stream – literally – by car-carrier ships found to contain the plant pest known as the brown marmorated stink bug.


Australia’s department of agriculture first detected the bug in 2014 in sufficient numbers to raise concern.


In 2018, there were three times as many stink bug infestations aboard incoming ships compared with the previous year.


The bugs are serious plant pests and finding these aboard results in a long delay for fumigation or a return of the vessel, with its load.


For JLR, this was a hefty blow as it appeared most of the ships it used were contaminated, resulting in delays for buyers in Australia. The next financial year, COVID-19 caused further setbacks for JLR.

Click to share

Click below to follow us on
Facebook  Twitter  Instagram

Market Insight articles

Motor industry news

GoAutoNews is Australia’s number one automotive industry journal covering the latest news, future and new model releases, market trends, industry personnel movements, and international events.

Catch up on all of the latest industry news with this week's edition of GoAutoNews
Click here