Car parts, lumber shortages affect Austin, nationwide businesses

As the economy starts to bounce back from a pandemic year, various industries are having trouble keeping up.

From processing chips to plywood, demand has gone up and supply isn’t quite there yet.

"When Covid hit everybody stayed home and they weren’t expecting for people to redo their houses, and it just has caused a delay on all materials," said Jesse Guzman, owner of GTown Lumber & Supply. "You’re just scrambling to get product right now."

Along with the pandemic putting a pause on production, the winter storm in Texas affected the production of some materials - including lumber. Simultaneously, more and more people are moving to Austin.

"The stories I’m hearing are from people that signed new build contracts last year before the anticipated lumber issues," said Delaine McMurry, a realtor with eXp Realty.

Some home buyers are ending up with a much different closing price than the initial cost on the contract for a new build.

"There’s a gap between when a contract is signed with a builder versus when they order materials," said McMurry. "So that increased price during that gap is what they’re trying to make up for."

At South Austin Nissan, they’re experiencing another shortage: computer chips. 



"It’s a chip that works the entire car so if one little piece is missing, it’s not going to run the automobile like it’s supposed to," said Armando Tello, general manager at South Austin Nissan.

Tello said they normally have around 300 new cars in inventory. Currently, they have just over 100.

In a call from Nissan this week, he was told they’d have to make do with what they had for the time being.

"Nissan just told us we’re not going to get any new vehicles for the next 90 days," he said. "I knew that Covid had an impact on a lot of stuff, I just didn’t know how bad it affected the automobile industry until I got that phone call."

Tello said they have been working more closely with sister car dealerships and trading cars if necessary. For example, this week he had a woman come in that wanted a certain color of truck with other specific amenities.

"We found the vehicle in another state and we did a trade," said Tello. "I don’t think it’s time to panic, the dealer’s just going to have to work a little harder."

At GTown Lumber & Supply, they don’t have that luxury.

Along with prices going up, they’re allocated to a certain amount they can purchase each month - and that’s it. Guzman said they’re limited to about half the inventory they would normally purchase.

"That’s just so the mills and producers can try and catch up," he said.

And that’s in addition to prices of lumber going up because of the supply and demand issue.

"Let’s say you want a 4x8 sheet - before this year happened you could buy one for around $10-11," said Guzman. "It’s around $45 now, and that’s what’s most commonly used on these houses that are built around here."