Last week, the auto industry was cautiously optimistic that new car sales in June might rebound, at least compared to April and May. But no one was terribly optimistic about the second quarter as a whole. Today, the numbers came in, and, to varying degrees, they are across the board terrible.
Let’s have a look:
The Nissan, Dodge, Fiat, and Chrysler drop offs are particularly brutal, while Mazda, Hyundai, and Alfa (??) seem to have fared a little better than the rest of the pack. Among other brands: BMW is down 39.3 percent; Rolls Royce, down 38.4 percent; Porsche, down 20 percent; Mini, down 41.5 percent; Maserati, down 55.9 percent; Mitsubishi, down 58 percent; Audi, down 35 percent; and Volvo, down 15.3 percent.
Figures for Mercedes, Ford, Jaguar, Land Rover, Tesla, and Ford have yet to be released, but you can expect they won’t be good.
Annual new car sales in the US, once thought to maybe reach 17 million, is now forecast to be around 13 million, a forecast which has gone up and down pretty much with however bad or hopeful the coronavirus news of the day is. Automakers seem ready to give up trying to predict whether the recovery will be V-shaped, U-shaped or maybe O-shaped, in which we find out in fact things will be bad indefinitely.
Here’s GM’s chief economist in Auto News:
“After falling into a deep recession in March, the U.S. economy has begun to recover as it reopens,” Genera Motors Chief Economist Elaine Buckberg said in a statement.
But she cautioned: “The path forward may not be linear, as rising infections in many states may lead to steps backward in the reopening process.”
Others are trying to stay optimistic.
Jeff Kommor, head of U.S. sales for FCA, said retail sales have rebounded since April, with steady gasoline prices, access to low-interest finance rates and renewed economic activity prompting some consumers to shop and purchase a new car or truck.
FCA said it prioritized retail deliveries over fleet volume in the second quarter and indicated it has a “strong fleet order book” which will be fulfilled in the second half.
“We’ve returned to business with April to June sales stronger than we could have expected, with the pace of recovery accelerating in the second half of the quarter,” Dave Gardner, executive vice president of Auto Sales at American Honda Motor Co., said in a statement. “We’re running a bit lean on inventory, but our dealers have been remarkably nimble in adapting to one of the greatest challenges our industry has ever seen.”
It’s hard to know where the bottom is, but it’s also hard to imagine the third quarter being any worse this. For companies that report sales by month, the June numbers were pretty much on track with the improved numbers many were expecting. Honda, for example, was down 16 percent for June while being down 28 percent for the quarter, suggesting that slowly but surely it’s picking up.