Shortage of electronics parts making car repairs more expensive

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The check engine light came on in my 2006 PT Cruiser, so I took it to my family’s mechanic. Dwayne Wagter of Wagter’s Auto Service delivered the news that no driver ever wants to hear. “It’s throwing up a transmission code,” he said.

Fortunately, the transmission shop in Bellingham, Washington, had slightly better news. The transmission problem is electrical, not mechanical, meaning that the Cruiser might still be saved.

The transmission shop replaced the solenoid at a total cost of about $630, but then, the check engine light flashed again about a week later. The diagnosis was that it was probably a dud solenoid. If not, it’s a computer problem.

“So, what does the computer cost to replace, if it comes to that?” I asked.

Answer: Currently, they aren’t available because of the worldwide computer chip shortage. If the shop has to replace my car’s computer, it will have to be “sourced” from a wrecking yard.

The chip shortage has hit the automotive industry especially hard. As a result, factories have been slowed or idled, and new models have been turned around much slower than usual.

It has affected the prices of both new and used models, but my PT Cruiser experience led me to ask a knock-on question: Will it lead to some cars becoming obsolete that would have been functional otherwise?

The answers are not cut and dried and show just how much the world has changed during the COVID-19 pandemic.

“This definitely could be bad, but honestly, I don’t’ know how bad,” Luke Thompson, a driver for Uber and Lyft from the Seattle area who pays close attention to tech trends, told the Washington Examiner. “For the short term, it seems pretty bad.”

Thompson needs to replace his Kia Optima soon. He had wanted to buy a used Tesla, but cost and technology considerations have persuaded him that’s not the best call at the moment. Currently, he has his eye on a newer Kia Niro, in part because he wants to make sure the shortage of replacement computers problem doesn’t bite him.

Prices for that vehicle vary by region. Thompson is considering flying to Georgia or Florida, buying a Niro there, and driving it back to save money.

Rich Hartman, an owner of a few car dealerships, believes the market will eventually sort the chip problem out.

“I feel it’s just a supply-demand issue,” Hartman told the Washington Examiner. “Highest demand gets the first attention, followed by other profit-relevant items. If there is a profit opportunity, people will make the items when chips are available.”

But the shape of demand has changed, and because of the sunk costs of building new factories to produce semiconductors is enormous, in the billions of dollars, it may be hard to keep up with that demand.

“You might be better off to have an older car than a newer one” for at least the next few years, said Ty Bailey, owner of the auto body shop Bailey’s Classic Collision (and, full disclosure, this reporter’s first cousin).

That is because of the enormous range of devices now competing with cars for those chips. For instance, video game systems continue to fly off the shelves as COVID-19-related isolation lingers. Bailey said he believes that video game manufacturers have done a much better job of locking chips down than the automotive industry.

This chip shortage is being further exacerbated in vehicles in America by a supply chain bottleneck. As a result, even when the parts can be had, it takes longer to get them to ready customers.

That means it may require ingenuity to keep relatively recent, computer-heavy cars running until an ample supply of chips becomes available on world markets again, and the supply chains lurch forward. What would have been crunched in wrecking yards in the past is thus becoming a sought-after commodity.





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