The past couple of years have been very challenging for the car industry, with vehicle supply issues, delivery delays and a shortage of many new makes and models. It’s likely that many of these issues will continue to affect the industry in 2023 – but we are working hard to keep our customers mobile and provide a wide range of affordable vehicles that suit your needs.
We caught up with Hayley, Manufacturer Relations Manager at Motability Operations, to discuss the current situation in the motoring industry and what this might mean for the Motability Scheme in the coming year.
Supply was a big challenge last year. Are there any signs of any improvement for 2023?
It’s quite inconsistent, but there are starting to be some small signs of improvement. We should remember that production and delivery times vary between models and manufacturers, with some being affected more than others – so there’s no ‘one-size-fits-all’ answer.
As ever, we’d recommend that if you’re interested in a car, speak to your dealer to understand the current lead times. You may want to consider a few similar cars from other manufacturers, to see how their supply is affected too.
We heard a lot about semiconductors, or ‘chips’ last year. Are these still the main factor affecting car supply?
The situation with semiconductors is an interesting one. The main reason for the chip shortage in the car industry was the COVID-19 pandemic. As companies purchased laptops for employees and people bought smartphones to stay connected with loved ones, the semiconductor supply was used to build personal devices. This meant that there were fewer chips that could be used to produce new cars.
However, things are starting to change. Because of the cost-of-living crisis, there is less demand for high-end electrical goods, which means that more semiconductor chips are becoming available for car manufacturers. But even with more chips, supply won’t return overnight, because manufacturers need to deal with large order backlogs. We expect that longer lead times for new cars will continue for much of 2023, as manufacturers work through their backlogs.
Are there any other issues currently affecting new car supply?
Manufacturers are still being impacted by the ongoing conflict in Ukraine, which has affected the availability of many raw materials which come from or through the region.
Where supply has been affected, manufacturers have had to adapt and try to get these products from other places. But there’s a limited number of suppliers for specialist raw materials, which means there’s less to go around and often higher costs to buy these items. All of this means higher costs to build new vehicles, and higher costs for us to buy the vehicle as a result.
How are car prices being affected by the supply issues?
Although the cost of buying a new car is still higher than it used to be, we’re doing all that we can to keep the Motability Scheme affordable and great value for money. Every three months, we renegotiate our prices so we can offer you the best deals from each manufacturer. We’re also investing money back into pricing, so that there are more cars available at a lower price point.
We’re really hopeful of improved choice and affordability for customers throughout this year. For this quarter, we’ve got over 30 models that cost less than your weekly allowance, plus over 80 additional models that are available with no Advance Payment. There are also over 200 vehicles available with an Advance Payment of £500 or less, which is twice as many as there were last quarter.
What about the range of cars available on the Scheme?
We’re leaving no stone unturned to get as many cars on the Scheme as we can. There’s currently a great range of over 750 cars available to choose from, which you can view using our Car Search tool.
Even after we announce pricing at the start of each quarter, we’re constantly speaking to manufacturers to see if we can add anything else during the quarter. We’re also speaking to some new manufacturers about trying to get their vehicles on the Scheme at some point in 2023.
The situation is still delicate though, so if you’re nearing the end of your lease, it’s worth acting sooner rather than later.
If we’ve extended your lease, you can order any time so there’s no need to wait if you find a suitable new car. Once your new car arrives you can also collect it straight away – there’s no need to wait until the end of your lease extension.
Remember that once you’ve placed your order, you’ve secured your place in the manufacturer’s build queue. We’ll keep extending the lease on your current car until your new one arrives, to keep you mobile.
What are your plans for electric vehicles on the Scheme this year?
We’re still committed to helping customers find the right vehicle for them – whatever fuel type that may be. Our website offers lots of information to help customers decide if an electric car is right for them, and there are a good range of electric cars available this quarter (starting from no Advance Payment).
We also include support with charging, including a home chargepoint and standard installation at no extra cost for anyone leasing their first fully electric vehicle (EV) on the Scheme.
Do you have any final tips for customers looking to join the Scheme or place their next order this year?
If you’re looking to join the Scheme, keep checking our Car Search and if you see a vehicle that you think might meet your needs, get in touch with a dealer as soon as you can.
If you’re an existing customer, you can order your next car three months from the end of your lease, or at any time if your lease has been extended. Again, it’s worth keeping an eye on our Car Search and once you’re able to order your next car, get in touch with a dealer as soon as you see a car that meets your needs.
With the supply situation still quite delicate, there is a chance that manufacturers will ask for vehicles to be taken off the Scheme for a while if they get more orders than they can fulfil – so it’s worth acting quickly if you’re eligible to order your next car.