May’s sales across all sectors causes shortages of raw materials

Joseph Bulmer

If for some, the return to work in April came too late to show in the figures, May has confirmed demand in many retail businesses is back with a bang.

As a result of a combination of circumstances, there are shortages of raw materials which will affect supplies now and through the third quarter.

To add to the semi-conductor issue there are now shortages of textiles and rubber which is required by many industries.

Used car sales were strong and dealer shortages caused auction prices to rise yet again and are forecast to rise even further in June.

There is a real possibility of inflation rising as sale prices are realigned to compensate.

This is reminiscent of 2009 when we came out of the financial crisis and supply could not cope with demand so it is no surprise prices of used cars are rising at record levels.

Some customers also delayed their purchase of a new car during the pandemic and are now back in the market.

New car supplies are still reasonable although there are shortages of particular models so if you are looking for a used car, dealers will not only be taking back cars in part-exchange but will be looking for stock and will be paying more for good, clean and well-maintained vehicles.

The van market is extremely buoyant as a result of not only the increase in online shopping and small business demand, but is seen by some retail buyers as a lifestyle vehicle with comfort and driveability performance to rival their current car.

Many manufacturers will run out of vans by July and dealers will hope new stocks reach them before the end of September.

On the aftersales side of business, it is obvious that traffic is returning to pre-pandemic levels and with the good weather over the bank holiday the South West saw an even greater number of visitors than normal desperate to get back to some relaxation and enjoyment.

Although there are some prepared to travel to Europe, most holidaymakers are likely to say in the UK until travelling becomes safer and does not require a quarantine period on return.

This is providing a welcome demand for the holiday and hospitality sector which has been severely hit during the pandemic.

Hotels, bed and breakfasts, holiday homes, caravan and campsites are reporting bookings right through to the end of the season all bringing vital income to the local economy.

The Government has at last realised the necessity for investment in the railway network and it is good news to see the return of stations like Okehampton and new ones like Marsh Barton at Exeter but it will take a very long time to sort out the South West network in order to provide an alternate to travelling by private car.

The Government has also confirmed its commitment to the electric vehicle infrastructure and their determination to meet the 2030 deadline.

As we all take our first steps and remain optimistic that all remains on course for further relaxation of rules later this month, please continue to take care and stay safe.

Keep smiling and I look forward to next week.