Why GM Ditched Heated Seats In The Middle Of Winter

A global shortage of microchips is hammering automakers. The chip shortage. The chip shortage. Growing number of companies sounding the alarm over global chip shortage. Dealerships have a sliver of the inventory they normally have.  the chips that will make them sellable. Meanwhile, demand is high and automakers are forced to sell cars without features like heated seats, considered essential in colder climates. On a market like ours, that's a highly desirable option. You know, I know just personally speaking, it's one of the first things that I fire up at this time of year and both on the wheel and on the seat. And so I think it's a sacrifice that a customer would have to make. General Motors has been directing the supplies it does have to its most profitable vehicles, but the carmaker has also said it plans to retrofit cars with heated seats as soon as they are available, and GM is not alone. All automakers are having to make tough decisions about which features to cut they can deliver vehicles to customers, and there isn't really a clear end to this in sight. The interesting thing here is that we think that there's some magical time coming where there's enough chips and then all of a sudden everything goes back  we go back on incentives. But it feels like that process is going to take a long time because right now we're seeing inventories down about 75-80 percent on aggregate, and you just don't come back from those numbers quickly. Today's cars have features that might have seemed unimaginable to previous generations. Vehicles today have ventilated seats that can be heated, cooled and adjusted in a for different drivers. A growing number of seats can even offer massages. It was actually a General Motors employee, Robert Ballard, who was responsible for the earliest known patent for heated seats, filed in 1951. And GM's  Cadillac, was the first to offer heated seats, just as it was the first to offer so many other innovations. The first standard heated seat was offered on a Saab in 1972. It engaged automatically when the temperature dipped below 58 degrees and shut off when it rose above 82. Creature comforts: sophisticated climate control systems, power windows, power locks, improved sound systems, artfully designed cabin lighting even TV screens have all become a lot more common, even in mainstream over time. Almost none of this would be possible without microchips. The earliest examples of computerization date back, at least as far as the 1968 Volkswagen, depending on how you define computer. As microchips have become cheaper to produce, automakers have made increasing use of them to control nearly everything in a vehicle. Even safety features such as headlights. The microchip shortage has left these automakers struggling to fill their vehicles. Global light vehicle production in 2021 is expected to finish at 75.5 million units, a paltry 1.2 percent improvement over 2020 levels, said IHS in December. So many carmakers have been making tough choices. Normally, when a car rolls off the assembly line, it is immediately spoken for, purchased by a dealer and then transported as soon as possible to that dealership. But now, many vehicles sit build-shy on lots awaiting completion. Dealer inventories are a fraction of where they were prior to the pandemic. Demand is extremely high and supply is extremely low. I think it's challenging for us. We'd love to have a greater balance of having more inventory to be able to supply to our customers, but it's out of our control. Car companies have been pushing their chip supplies toward the most profitable vehicles, and customers are paying more than ever for their cars. Data from automotive shopping and information website, that average transaction prices for new vehicles have hit record levels in recent months. For example, they climbed to $45,872 in November 2021, compared to $39,984 in November 2020. Buyers are paying above MSRP for new vehicles in November. The average MSRP was $662 less than the average transaction price on a national level. That vehicles available for sale are richly equipped with more features. In 2016, the average vehicle cost 30 percent above MSRP, in 2021 that figure was on trend to reach 38 percent.