At the beginning of this year, forecasters thought 2020 would see car sales in the U.S. of just under 17 million. That would’ve been a modest decline from 2019, when car sales were just over 17 million. Then coronavirus happened, and the new reality set in.
On March 18, an analyst said that auto sales could fall to 13.5 million this year, but back then that was more of an educated guess rather than an accepted truth. But it’s looking more and more accurate, and perhaps even an underestimate, an economist with the National Automobile Dealers Association said yesterday:
NADA now estimates new light-vehicle sales between 13 million and 13.5 million units for the year – down from an original 2020 sales forecast of 16.8 million units.
“While the impact of the coronavirus is uncertain at this point, we do know that the leases on 1.8 million vehicles are set to expire between March and July according to data from J.D. Power, and most of these customers will be in the market for a replacement vehicle,” added [NADA chief economist Patrick Manzi]. “Additionally, once Americans return to work, we expect pent up demand, but just how much is still ambiguous.”
Pent-up demand doesn’t seem like an unreasonable expectation when this is all over, though it’ll be interesting to see what percentage of that will also evaporate because people who might have otherwise bought a car remain unemployed.
On top of that, automakers had a lot of debuts planned that might have goosed sales but are now delayed. That includes the new Land Rover Defender, the new Ford Bronco, and the Aston Martin DBX, alongside recent-ish introductions like the Kia Seltos, Chevy Trailblazer, and the Tesla Model Y.
Bloomberg has a nice roundup of the situation that includes this dour note:
For sales of the most anticipated cars of 2020, the timing couldn’t be worse. In a normal economy, the first few months for any shiny new machine are relative magic. Overeager customers clamor for the fanciest, most profitable versions, and dealers seldom have to offer discounts or incentives. Now, every sale (done online or over the phone) will be considered a coup.
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