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Car premium is growing at an appalling pace. ‘We have an unprecedented situation’

Car premium is growing at an appalling pace.  'We have an unprecedented situation'

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The average waiting time for a new car is currently 6 to 9 months. Delivery times are increasing from month to month, incl. Due to the lack of components used in the production of cars. In August, the average car waiting time was about 5 months. It’s been three months and it’s much worse. Whoever had hoped for an improvement in the situation lost it.

We currently have an unusual situation where common sense dictates to remain calm and wait for the crisis to end. At the same time, the observed volume of vehicle prices and extended delivery times suggest that by forgoing the deal, we risk significantly higher prices and possibly even greater delays – said Michel Netter, Vice President of Carsmile. – If a person really needs a car, at some point he will not be able to postpone the purchase. At the moment, it is not clear where the ceiling of these two phenomena is in the market, that is, prices and delivery times. He assessed that this is a paradox in epidemiological economics.

The biggest problems with automatic transmissions, multimedia systems and displays. The list of missing equipment items also includes monitoring systems, heated seats and induction telephone chargers. Even the steel for the body is missing.

A period of 6-9 months is the average of the market. There are still models that we will get faster, even in 2-3 months with significant concessions when it comes to equipment, but also those that we will have to wait a year or a half – Knitter noted.

Waiting time is not the only problem. What’s new is the amount of price increases we’ve noticed recently. Manufacturers change car price lists every month and a half, and the average range of increases shown in a new price list is 2-4%. The expert previously noted that the rule was to change price lists once or twice a year, and not every month.

How does this translate to the governor of the Poles? Carsmile analysts calculate that in just 10 months this year, the average monthly vehicle payment has increased by as much as 17 percent. People who signed a contract in October pay that much more than the average for contracts from January.

– 17% shows actual inflation in the car market over a period of 10 months only. This is the result of an increase in vehicle catalog prices, a significant decrease in deductibles, and an increase in service costs and auto insurance expenses, Knitter calculates. To this must also be added the accelerated fuel prices.

Carsmile experts calculate that the average monthly subscription fee for a car whose rental agreement users entered into in October will be PLN 1,750 net, or PLN 2,153 total. For contracts concluded in January, it was net PLN 1,494 (gross PLN 1,837).

– The rental premium better illustrates market trends, because it includes all components of the cost of using the vehicle, excluding fuel. It’s kind of a benchmark for the auto market, Knitter explained.

Between January and October, the average premium for a vehicle increased by PLN 256 net, or PLN 315 gross. According to experts, this means that a month of hesitation “buy?” or “Do not buy in the hope of improving the situation?” It results in a higher subscription fee of PLN 32 total per month, because the premium is fixed over the term of the contract. Within 3 months, the total cost is about PLN 100, and within 3 years of rental it is PLN 1134. This is an unprecedented situation.

In the face of accelerating car prices, Carsmile predicts that in the next 12 months, transaction prices for new cars will increase by 15-20 percent. According to the latest data from Summer, the average price of a new car in Poland in September amounted to 136,716 PLN and decreased by 10.6 percent. greater than the previous year. However, this increase does not fully take into account the change in the merchant discount policy (only the official manufacturer’s discount). Interestingly, the factors that have so far forced producers to raise prices (EU emissions requirements and equipment requirements) have receded into the background.

According to analysts, there will be no annual sale of cars this year.

Carsmile’s vice president said, orders placed in December will be fulfilled at the end of 2022 at much higher rates than they are today.

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