To those still rich enough to buy cars in this high COE climate, expect more delays

[BabyBlade]

SINGAPORE - Retiree Steven Chia placed an order for a Mercedes-Benz GLB from authorised agent Cycle & Carriage last September, and waited seven months for it to be delivered - more than double the usual time.

Mr Chia, 62, said: "I was supposed to collect my car last December or January this year, but I was told that because of the Covid-19 lockdowns and the war in Ukraine, shipment was delayed. I finally got my car on April 23."

For motorists looking to buy a new car, be prepared to wait - possibly as long as Mr Chia, if not longer.

Carmakers reeling from supply chain disruptions brought about by the pandemic are now facing another whammy - the prolonged war in Ukraine.

The Eastern European country invaded by Russia in February is a major supplier of automotive parts - from electronic components to seats to wire harnesses, which bundle kilometres of electrical wires in a vehicle.

The conflict is disrupting production, and this is affecting more than a dozen vehicle manufacturers, including Volkswagen, Audi, Porsche, BMW and Renault. Unlike the chip shortage, which manufacturers could overcome by leaving out certain features, a vehicle cannot be assembled without wire harnesses.

While Japanese and Korean manufacturers are less affected, the war also has other indirect consequences like raw material costs, which is impacting the entire industry.

Associate Professor Tan Yan Weng, head of the Logistics and Supply Chain Management Programme at the Singapore University of Social Sciences' (SUSS) School of Business, said car buyers can expect delays of new model launches as well as longer delivery timelines.

"For certain makes of cars, a lead time of three months may now be six to eight months," said Prof Tan.

A senior manager at a major dealership said: "Almost every other month, there's an update of production delay or new model launch delay. Everything is so fluid.

"It is still manageable now as we have ample existing stock to sell. But things may worsen towards the last quarter of the year."

Volkswagen Group Singapore managing director Ricky Tay said the company currently has a "sufficient supply of cars to cater to sales".

"It is a blessing in disguise because demand has fallen with high COE prices," said Mr Tay, but he admitted there was uncertainty ahead.

He reckons that electric cars are bearing the brunt of the supply chain disruption, echoing what Volkswagen Group chief executive Herbert Diess has said.

Mr Diess said in a recent interview with Financial Times that the economic risks posed by the Russian-Ukraine war were "very much worse" than those posed by the pandemic.

His German counterparts, however, were more coy when asked about the impact the latest supply chain crisis had on the Singapore car market.

An Audi Singapore spokesman said two new electric models due to be launched next year are now "pushed back by two years".

Two other models - the SQ7 and SQ8 - which were due here in the first quarter of this year are also slightly delayed.

But she said the latter was not because of Russia's invasion of Ukraine, but because of another ongoing supply chain disruption: insufficient shipping capacity.

Other new car arrivals that are delayed include the Toyota Corolla Cross (from third quarter to fourth) and the BMW 8-series range (second quarter to third).

BMW Group Asia managing director Lars Nielsen said: "The war in Ukraine is impacting the country's automotive supply industry. Combined with the ongoing semiconductor bottlenecks, these supply limitations can lead to production adjustments and downtimes at our European plants.

"While we do not foresee any immediate impact on our business in Singapore, we are faced with a positive challenge of more demand than supply."

A Daimler South East Asia spokesman said delays in the delivery of Mercedes-Benz cars here cannot be ruled out.

"In Singapore, we are working intensively with our authorised dealer Cycle & Carriage to ensure our customers receive their new vehicle as soon as possible. However, since the situation remains volatile, partial delivery time shifts for individual vehicle models cannot be ruled out completely."

Porsche admitted that there is a longer waiting time for delivery of some models, but did not elaborate.

"We view the armed conflict in Ukraine with great concern, and the degree of impact on our business activities is still continuously determined by experts in a task force team in Germany," said a spokesman for Porsche Asia Pacific.

 

Ms Jasmmine Wong, chief executive of Toyota and Suzuki dealer Inchcape Greater China and Singapore, said customers who bought two recently launched models - the Toyota RAV4 Hybrid and Lexus NX450h+ - will experience a "slightly longer waiting time".

"We still have stock for customers who do not insist on certain colours," she said, but otherwise, the wait will be "three to four months" versus "one to two months" previously. Ms Wong added that the delay is not because of Ukraine, but the ongoing supply chain disruption.

Over at Tesla Singapore, there is still no word on when the Model Y will go on sale here despite the car having been inspected and approved for sale by the Land Transport Authority back in early January. It is understood that the delay is because of Shanghai's latest Covid-19 lockdown in March.

Tesla registered only one car in April - down from a monthly average of 60 units in the first quarter, and around 150 a month when it started delivering cars from July last year.

Source: Straits Times

[ER-3682]

Covid-19...then now War...Putin is a Idiot.😥

Edited May 16, 2022 by ER-3682

[Lotr]

How does the AD price the COE portion if it is a 8 months wait?

[Silverkris]

Most AD can absorb the increase in COE down the road if it is not too much due to higher profits.

If it decreases down the road, they sure will not refund any $$$ at all unless really below the rebate amount that they stated.

If it further increases too much, they will ask for top ups or refund you your down payment.

[Mkl22]

6 hours ago, Lotr said:

How does the AD price the COE portion if it is a 8 months wait?

Even if it loses money on this deal, up the price to get it back on the next order. 

[ER-3682]

That is why alot of P.I. ''huat'' with exsisting stocks.

[Wolfverine]

No cars to sell/deliver until months later .... does that mean that this week COE bidding will crash 🤣

[Dannnn]

If they dont hve ready stock, their OT isnt high. meaning their profit is at least 50-80k range, which should be enough to absorb the diff.

only ready stock car can get "better" price

 

[Watwheels]

The wait long long isnt bad for just the car buyer...it is also bad for the car dealer. Means delayed payment.

If I'm not wrong the car dealers arent having a good time.

Merc has a permanent small size showroom at Great World City. Like the Tesla one at Millenia Walk. I just saw BMW putting up two models on display at Westgate. The 2series sedan and 2GT. Cars and kopi at Jurong Point.

Kinda feel that buyers are staying away from buying new cars for now. High COE prices and long waiting time. Used cars dealers should be having a field day.

Edited May 16, 2022 by Watwheels

[Lotr]

2 hours ago, Wolfverine said:

No cars to sell/deliver until months later .... does that mean that this week COE bidding will crash 🤣

Was thinking the same thing, theoretical possible if fewer cars to register than coe supply. Would be very strange it really happen

[Dannnn]

13 hours ago, Watwheels said:

The wait long long isnt bad for just the car buyer...it is also bad for the car dealer. Means delayed payment.

If I'm not wrong the car dealers arent having a good time.

Merc has a permanent small size showroom at Great World City. Like the Tesla one at Millenia Walk. I just saw BMW putting up two models on display at Westgate. The 2series sedan and 2GT. Cars and kopi at Jurong Point.

Kinda feel that buyers are staying away from buying new cars for now. High COE prices and long waiting time. Used cars dealers should be having a field day.

Everyone feel so... but COE still keep climbing up.

Even AD sales said showroom very quiet.

[Littlewhitei]

@Lotr In my case, COE was bidded in Oct 21. Was set to expire last month but AD got LTA to extend until Aug. So current TCOE still valid with Oct 21 price.

[yishunite]

Heng i no $$$ to buy new car

[Ody_2004]

@RadX i smell a fish..

[RadX]

6 minutes ago, Ody_2004 said:

@RadX i smell a fish..

Indeed! Tks bro

[Samlimlp]

Wonder what would happen, how people who bidded their COE at current high, and while waiting for their cars, COEs crashed ?

[Dannnn]

1 hour ago, Samlimlp said:

Wonder what would happen, how people who bidded their COE at current high, and while waiting for their cars, COEs crashed ?

forgo the deposit?

[Picnic06-Biante15]

More like its only affect those cars from European countries... 

No delays for Japan, Korea and China vehicles.