Suzuki Jimny, D-Max Ute: New car prices rise with computer chip shortage

New car customers have been told they will have to pay more because of delays linked to COVID-19 and a computer chip shortage.

New-car buyers are being slugged with price increases while they wait for their cars to be delivered, as stock shortages linked to COVID-19 and a computer chip problem worsen.

Customers who have ordered Suzuki Jimnys have been told they will have to pay $1500 more, while Isuzu recently increased the price of its popular D-Max ute, which also has a long waiting list, by $1000.

Suzuki declined to comment on the price rises, but Isuzu director of sales and marketing, Koichiro Yoshida, said the brand was working with dealers to ensure the latest price rise wasn’t passed on to customers waiting for delivery.

“We are working diligently with our Isuzu ute dealer network to ensure that all existing customer orders already in the system prior to the price increase announcement will be honoured at the agreed price,” he said.

Mark Toll, from Caloundra on Queensland’s Sunshine Coast, said he ordered a Jimny in December last year and was given a June delivery date.

Earlier this month the dealership told him it was passing on a manufacturer increase of $1500.

“You think you have a deal done and dusted and then this happens. It’s not quite Kosher,” he said.

“It’s probably a bit of price gouging,” he said.

Customers who have ordered Suzuki Jimnys have been told they will have to pay $1500 more. Picture: Thomas Wielecki

Zac Innes, from Northcote in Melbourne, is expecting delivery of his new Jimny in September. He said he wouldn’t be cancelling his order.

“Price increases are one of the risks you take when ordering an in-demand vehicle,” he said.

The ACCC says companies can raise prices between ordering and delivery if they specify that in the sales contract, but dealers who guarantee a fixed price then attempt to raise it later could be guilty of misleading or deceptive conduct.

The issue is likely to become more common as waiting times for new cars blow out due to a global shortage of semiconductors in the wake of COVID-19.

Car makers pulled back on semiconductor orders last year in anticipation of a sales slump.

At the same time, demand for game consoles, iPads and laptops took off as people set up their homes for work and play during lockdown.

When new-car sales bounced back from COVID much sooner than expected, factories couldn’t keep up with demand.

Discounts on new cars have dried up as dealers don’t need to clear stock.

With demand outstripping supply, dealers report their profit margins on new cars are the highest they’ve been for more than a decade.

The chip shortage is likely to get worse in coming months following a fire last weekend at one of the world’s biggest semiconductor factories.

A fire at the Renesas Electronics’ Naka plant in Japan. Picture: Supplied

Renesas Electronics’ Naka plant in northeast Japan supplies roughly a third of the world’s semiconductor chips worldwide. Toyota, Honda and Nissan are expected to be hardest hit by the fire.

The average new car has more than 100 chips on-board, powering everything from the touch screen to engine mapping and crash avoidance technology.

Ford spokesman Matt Moran said the semiconductor shortage presented challenges.

“We will continue working closely with suppliers to address potential production constraints, working to prioritise key vehicle lines for production, making the most of our semiconductor allocation,” he said.

Nissan spokeswoman Karla Leach said: “We would prefer more stock across all our models.”

“With such uncertainty surrounding supply chains and production capacities around the world due to the pandemic, we don’t expect stock levels to return to normal conditions for some time,” she said.

Mercedes is facing delays on some small cars and compact SUVs, while Hyundai is believed to have shortages on SUVs, although the brand said the issues were “manageable”.

Mazda said it was still “confirming the scope of the impact” of the fire in Japan, but a Toyota spokeswoman said waiting times would increase for popular models.

“Although our plants are increasing capacity, we are anticipating that wait times for high-demand models and some accessories will be longer than usual in the coming months.”

Originally published as Suzuki Jimny, D-Max Ute: New car prices rise with computer chip shortage