Car shortage: A file picture showing people waiting in line at the Miami airport car rental centre. High demand is sending used-car costs soaring with the Manheim Index, which measures prices at wholesale auctions, at 52% higher than a year ago. — AFP
NEW YORK: The semiconductor shortage has slashed vehicle production so much that rental-car companies can’t get the new cars they need, so they have resorted to buying used vehicles at auction.
This is uncharted territory for the likes of Hertz Global Holdings Inc and Enterprise Holdings Inc, which have made their profits by purchasing new vehicles cheaply in bulk, renting them out for as much as a year and selling them at auction.
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