How to buy a car this summer
When the chips are down, here's how to come out—well if not ahead, a little less behind. Also: our trivia winner and an Understandably Live event (today!) Plus, 7 other things worth your time.
You know what’s crazy right now? Car prices.
It’s largely a simple matter of supply and demand, and it starts with computer chips. I think the history went like this:
First, the 2020 trade war with China stopped US companies from buying Chinese chips. Companies looked instead to Japan, Korea, and Taiwan, but those countries’ manufacturers were already near capacity.
Then, demand for chips skyrocketed during the pandemic. People who were stuck at home upgraded their equipment, and global shipments of consumer PCs jumped 26.1% over 2019.
Next, Taiwan suffered a drought. Chip manufacturers use massive amounts of ultra-pure water, so their production dropped.
Then there was a fire at an important Japanese factory, and domestic chip production in Texas took a hit as a result of the extreme freeze in February.
Fewer chips means fewer new cars. Add that to the general rising tide of inflation, and it’s one of the toughest times to buy a car in recent memory.
OK. So what’s the solution, if you’re…
