Since the covid crisis in 2020 sits the automotive sector in a difficult period. The production interruptions, parts shortages, rising energy prices and mandatory transition to electric cars are all factors that have disrupted the market.
But after months of difficulties, some things start to get better stabilize. The delivery times for example, which increased to almost two years for some models at the height of the crisis. These waiting times indicated a certain scarcity, which the Prices naturally increased and the (sometimes very large) discounts for customers disappeared.
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Back to normal?
In 2023 however, we see one recovery: both in supply chains, which are gradually returning to normal, and in sales, which are (finally) on the rise again. In the first nine months of the year, FEBIAC registered 318,000 registrations of new cars, which is encouraging. Or at least it was, because traders now see one delay. Understandable, because according to mobility federation Traxio, private individuals are leaving crisis time the new car market to seek refuge in the second hand market.
But in the meantime, car manufacturers have fully opened their factories again and are producing at full capacity. And probably too much, as evidenced by the ever growing car inventories. According to L’Echo, in particular D’Ieteren An negative free cash flow for the first half of the year, demonstrating the size of its inventories. The company expects this situation to remain this way until at least early 2024. This is because the strong growth from the beginning of this year is subsiding. Although the figures for September 2023 still show growth, it is less strong than at the beginning of this year.
Are there any bargains to be had?
A increase in inventories will force the automotive sector to get rid of cars waiting in the car parks. This will lead to the return of bigger discounts on new cars. Not on all models, but on many models copies in stock are. That goes without saying.
The second hand market remains popular, with a increase of 4.1 percent in September 2023, according to Traxio. But this is also less than at the beginning of the year, when growth was still 7 percent. If you are considering buying a new car, you should pay attention. Since used car prices are currently stable, a big discount can be a new car maybe more attractive to make. In any case, the market is moving. Making the right choice in this changing situation is more complex than ever.
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