Supply Chain Snarls Will Keep Car Prices High, Morgan Stanley Analyst Says

Prices for automobiles, both new and used, were at a new high level as of June, a report from Seeking Alpha says.

The company quoted Kelley Blue Book in saying that a new car in the U.S. sold for an average of around $48,000, which was a new record.

Used car prices have fallen in price from their peak in May, but the average price is still around $28,000.

The elevated prices for cars mostly comes from the supply chain issues going on globally, which have made things worse for deliveries for many automakers including GM and Toyota.

According to GM, there were almost 100,000 vehicles waiting for components in July that were unable to be shipped to dealers.

“GM’s second quarter vehicle wholesale volumes were impacted by the ongoing semiconductor supply shortage and other supply chain disruptions mostly in June,” the automaker explained at the time. “As a result, GM will hold about 95K vehicles manufactured without certain components in company inventory until they are completed and will recognize revenue when they are sold to dealers, which is expected to happen throughout the second half of 2022.”

And Adam Jonas, a Morgan Stanley analyst, has said there’s not much sign of improvement in July, with the projected deliveries likely to take effect in the second half of this year.

PYMNTS wrote recently that more commercial fleets have been trying to manage vehicle operations by enlisting telematics and software platforms.

Read more: Ford, Other Automakers Plug Into Demand for Connected Fleet Subscriptions

Ford was one of them, saying that its paid telematics subscriptions were up 40% sequentially in both its first two quarters.

The telematics offering is a way for Ford to use a Software-as-a-Service (SaaS) mechanism to add more relationships with customers. It will improve vehicles as well as services to manage them.

The solution will reportedly deliver data on vehicle health, location, fuel efficiency and driver behavior.