We have all heard about the global microchip shortage affecting the auto industry. The outsourced chip shortage is expected to continue into next year. What other parts do automakers outsource and is it necessary for us to know which ones are outsourced?
What are the ramifications when our favorite car brand outsources for parts? In the case of the microchip, automobile manufacturers are not always able to offer us all the features we were hoping for when buying a new car.
Some luxury brands have been forced to do away with some of their usual high-end upgrades. For example, Porsche does not have the necessary chips to offer their high-end, 18-way adjustable seats.
Automakers have started to think outside the box and search for quick solutions. What was once a digital speedometer, might, for now, be an analog.
Car Brands Affected by Chip Shortage
The auto industry has been affected as a whole. This is a global crisis, not limited to the United States. Here is a brief list of car brands that decided to temporarily halt production of some of their models as a result of the chip shortage.
- General Motors
- Ford
- Jaguar
- Dodge
- Mercedes
- Mitsubishi
- Subaru
What does this mean for us as consumers? We will need to wait longer for a new car and will likely pay a higher premium for one as the demand increases. With low inventory, dealers don't have the need to offer incentives to purchase and move cars off the lot.
Used Vehicle Sales
When the need for a car is urgent, then a used car is the solution. Used vehicle sales are thriving. Our options to buy a used vehicle extends outside the dealership lots.
Private sellers and online sales are additional ways to search for a used car. These days, you can search for a car, apply for financing, and take delivery from the comfort of your home.
Do yourself a favor and do your homework before buying a used car. Similar to buying a new car, know what you can comfortably afford. Keep repairs in mind.
Used cars have higher mileage odometer readings. Higher mileage often means more maintenance and an increased chance of things breaking, simply because of age.
Consumer Protection
There are many government agencies in place to protect our car purchases and car repairs. Deceptive dealerships and deceptive auto repair shops should be reported to our local state consumer protection agency.
Lemon laws apply to defects on new cars. The Better Business Bureau has a national programdedicated to help consumers resolve lemon law disputes.
Other Parts That Automakers Outsource
On the surface, we, as consumers, are impressed when the salesman states the BMW has Brembo brakes, or the Mercedes Benz includes a Harmon Kardon sound system. These are two popular examples of outsourced parts.
Safety
Many automakers outsource safety system components.
- Airbags
- Seatbelts
- Braking systems
- Advanced safety features
More Parts
BMW is one of many luxury brands that rely on outside suppliers for parts. Volvo reportedly outsources nearly 80 percent of their engine parts.
- Steering wheel columns
- Drivetrains
- Automatic transmissions
- Exhaust systems
- Tires
- Batteries
Rumors are spreading that gasoline-powered cars will soon be a memory. Electric car production is on the rise. Their batteries are largely outsourced.
Why Parts Are Outsourced
Automakers outsource parts for a number of reasons. Some automakers also outsource assembly.
- Cost savings
- Industry expertise
- Parts delivered ready to install
Outsourcing saves on cost, but not on quality. Car manufacturers have relationships with suppliers that hold the right expertise needed to create today's specialized auto parts.
Pros and Cons
Many of us are quick to feel patriotic and say outsourcing is bad for the economy.
- When automakers purchase outsourced materials at a lower cost, the savings is passed down to us
- The United States is receiving high-quality parts made by experts in the field
Are we being misled? We assume that all original parts are OEM, the original equipment manufacturer. With so many parts outsourced, is it likely that the auto manufacturer did not manufacture the OEM part?
OEM and Aftermarket Parts
What about repairs and replacement parts? The push is always for authentic OEM parts. Is that necessary?
Auto dealership service departments will automatically replace malfunctioning parts with OEM parts. What about a local mechanic?
Aftermarket parts are parts made the same way as OEM parts. Some argue that aftermarket parts are of equal quality as the OEM parts. Aftermarket parts are less expensive than OEM parts.
It is important to use and develop a good relationship with a skilled mechanic. Their expertise will guide you with making the correct decision. A reputable mechanic recommends the proper parts necessary for quality repairs and maintenance.
Is It Necessary to Know?
Is it necessary to know which parts of the car are outsourced by car manufacturers? We reviewed why automakers outsource parts, examples of outsourced parts, and the cost savings.
We presented the thought about authenticity of OEM parts. We revealed that aftermarket parts are equal in quality and more cost-effective than OEM parts. Most importantly, we discussed the need for a reputable and skilled mechanic.
Used Car Buying
As mentioned earlier, used vehicle sales are booming. Second and third car owners won't always know the full history of the car they are selling. They won't have all the repair and maintenance records, and they won't know what parts the automakers outsourced.
We can protect ourselves by doing research first. Have the vehicle history checked online before buying. Epicvin™ offers several services, including free services to protect consumers from fraud and unsafe vehicles, keep stolen vehicles from being resold, and provides users with accurate and complete vehicle information.
A history report contains valuable information including ownership and title history, odometer reading history, open safety recalls, and any history of vehicle damage. Visit us first, before making any costly decisions.
