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Reconditioned cars, a solution to delays caused by microchip shortage

Simonluca Pini Contributing Editor of Il sole 24 Ore

Manufacturers are considering direct factory vehicle reconditioning
The microchip crisis has thrown the entire automotive industry off balance. After dealing with government-mandated shutdowns due to the Covid-19 pandemic, 2021 was further marked by halted production lines and major delays which have led to a global shortage of semiconductors. Manufacturers and suppliers have had to revise production lines, model layouts and delivery times, in addition to facing a substantial drop in new vehicle registrations. In fact, if the market in Italy was well below the one and a half million registration mark, the reason must be largely attributed to a shortage of cars on display in showrooms around the country, as production slowed down due to the lingering absence of microchips. Added to this is the fact that leading automotive groups have preferred to allocate the short supplies to models with higher margins, thus leaving segments with lower earnings, but more sought after by customers, high and dry. 
Reconditioned car as an alternative     
Given the lack of new cars, customers' attention has shifted to recently registered used cars. In just a few months, the value of second-hand vehicles increased in most cases, and dealerships have emptied their parking spaces to meet customer’s needs. Even vehicles previously used by commercial flees have become more attractive in the marketplace, precisely due to the evident absence of new cars. In view of the global shortage of cars, a new procedure linked to vehicle reconditioning has started attracting interest in Great Britain and could be extended to other markets. It involves direct factory reconditioning, carried out by the vehicle manufacturer itself. The aim is to extend the life of a car by at least ten years, thanks to two reconditioning cycles. In a nutshell, after the first cycle with a customer (usually about three years), the car will return to the factory where it will be reconditioned to the highest standards, offering the second user a vehicle in "perfect health". The procedure could then be repeated a third time which means 10 years of use in perfect efficiency. At the end of this period no scrapping policy needed, but a form of total recycling by the manufacturer, starting with the batteries found on hybrid models. 
Sustainable reconditioning  
Besides being an answer to the shortage of new vehicle models, factory reconditioned cars could significantly reduce manufacturers' carbon footprints. Given the assumption that these models will comply with the latest emissions regulations, and the reduced production of carbon dioxide in the case of full hybrid cars, extending the useful life of a car will help to create a closed loop of real sustainability. Crucial will be the creation of a policy for the total recovery of batteries in hybrid, plug-in and electric cars; furthermore, in the next few years, strategic metals necessary for the energy transition and electric mobility will become increasingly sought after and consequently their use must be particularly efficient.

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