U.S. Car Sales Skid
New-car sales in the U.S. shrank more than one-third last month because of the coronavirus pandemic.
Specifics about last month’s results in the U.S. is tricky because most carmakers—including General Motors, Ford and Fiat Chrysler Automobiles—have switched to quarterly sales reports. But even those numbers are ominous.
GM says its U.S. sales in the first quarter fell 7%. Volumes at Ford and FCA each shrank 10%. Not so bad, you say? Well, not when you realize those declines were due entirely to really lousy sales in the last 14 days of the three-month period.
March Car Sales
Among the handful of brands that did report March sales, the wreckage is more telling. Sales shrank between 19% at Kia to 51% for Acura. Again, the damage all came in the second half of the month.
The National Automobile Dealers Assn. says total retail car sales in the U.S. last month dropped 34% to an annualized rate of only 11.4 million units. Perspective: Sales totaled 17.1 million in 2019.
LMC Automotive calculates an 11.2 million annual sales rate for March. The firm says the pace could slow to 9 million in April, as the proportion of American under stay-home orders continues to grow.
What’s worse, temporary plant closures are likely to cut production this month by 90% to a mere 140,000 vehicles, says Jeff Schuster, who heads LMC global forecasting.
Europe’s Automotive Forecast
Europe is dealing with the same dynamic, but it got started earlier. The region’s sales picture shows what’s in store for the American market.
March sales data from ACEA, the region’s auto industry trade group, won’t be released for another two weeks. But government and local trade group reports show that last month’s sales fell 72% in France, 86% in Italy and 69% in Spain.
On Wednesday, carmakers in Germany huddled (by phone, of course) with Chancellor Angela Merkel about strategies to restart production soon. Producers fret that some of their smaller suppliers won’t be able to ride out a shutdown for long without a big dose of U.S.-style government aid.
Even then, a breakout by one country won’t get far unless the rest of Europe (and its suppliers) are ready to go too. Analyst cautions that the revival, when it comes in Europe or anywhere else, may be rapid. But it won’t happen overnight.
If heritage means anything in this industry, then it is surprising that Buick doesn’t make more of its history because the story of the early years of the company is nothing short of astonishing.
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To know that 3,000 cars have been delivered since October 2015 would undoubtedly result in a shrug: in 2017 Toyota delivered 387,081 Camrys, so that 3,000 is less than one percent, and this is in one year, not just over two.