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The global microchip shortage stemming from a variety of COVID-19 and trade-war related production disruptions, that has impacted supply chains across the world including the automotive sector, is very much top of mind with Canadian car shoppers.

In fact, according to an online study of over 500 and marketplace auto intenders conducted in June 2021, 9 in 10 respondents said they were aware of the shortage and 78% said they expected it would have some impact on the automotive industry as well as market.

Among Canadian car shoppers, the most highly perceived effect of the microchip shortage is that dealerships will have less selection of new vehicles and prices will be higher. Specifically, 84% of respondents said they expect to see less selection of new cars on dealership lots, and 71% anticipate encountering higher than normal prices. Further, 65% believe there will be less room to negotiate and 57% believe there will be fewer purchase incentives and promotions due to the supply squeeze.

Interestingly, consumers astutely anticipate used car pricing and inventory will be affected by the global chip shortage in much the same way, as demand for used vehicles will be driven up by the decrease in supply for new cars.

What should be of particular interest and reassurance to dealers is that according to the research, Canadians are willing to go the extra mile to purchase a car. Nearly one third of prospective shoppers said they are willing to pay more for a new vehicle due to the microchip shortage.

Many are also willing to make adjustments to their vehicle shopping strategy to address the challenge. This includes 42% of respondents who would be willing to travel further to purchase a vehicle, with 31% open to travelling more than 400 kilometers to find the right car. More time spent comparison shopping for vehicles on online marketplaces like is something 35% of consumers anticipate doing as a direct result of the microchip shortage, with nearly half (49%) expecting to spend an additional two to four hours a week comparing vehicle offers online.

The temporary decline in supply of new vehicles has also prompted 27% of car shoppers to be willing to switch from purchasing a new vehicle to purchasing used, and 20% are willing to cross-shop between makes and models.

Finally, when asked what would help make their car buying experience better in the face of the microchip shortage, nearly half (49%) of respondents said that having access to a price comparison tool to help them determine a good price for a vehicle would be most beneficial.

Receiving direct updates on the microchip shortage and its impact on the automotive marketplace was cited by 22% of respondents as being beneficial to their car buying experience.

In conclusion, it is fair to say that this most recent consumer study demonstrates that Canadian vehicle buyers are well aware of the challenges being posed to the automotive industry by the global microchip supply drought and that they are prepared to adjust their shopping behaviours accordingly. In knowing this, it would be beneficial for dealers to fine-tune their marketing and customer service strategies to provide prospective buyers with valuable information to help them along the vehicle purchase path.