U.S. Set to Shed 3 Million Auto Sales: J.D. Power

Steph Willems
by Steph Willems

The final impact of COVID-19 on the country’s auto industry is becoming increasingly less blurry. In the U.S., the Magic 8-ball foresees a significant hit to dealers and automakers in 2020, with J.D. Power now saying the already cooling market will see 3 million purchases vanish from sales ledgers.

The viral sales cull would bring the industry back to 2012-2013 levels, though at this point there’s too much uncertainty to predict when things return to normal.

As reported by the Detroit Free Press, J.D. Power’s study sees the country’s 2020 vehicle sales tally coming in somewhere between 14 to 16 million vehicles — down sharply from last year’s 17.1 million, though the regional impact will vary. Prior to the pandemic’s arrival, J.D. Power forecasted sales of 16.8 million.

The market has already shed some 38,000 sales in March, the report claims, with the decline accelerating as more states enact extreme social distancing measures. The impact on businesses, including dealerships, is compounded by an increase in (at least temporary) joblessness and virus-borne uncertainty.

As of this past weekend, new vehicle sales in Seattle had dropped 18 percent for the month, with San Francisco falling 17 percent. Those results, both coming from viral hotspots, are outliers compared to stable car-buying locales like Detroit and Minneapolis, the report said, but that will change.

A bright spot in the doom and gloom, J.D. Power said, is a glut of leases coming to an end. In the second quarter of 2020, some 1.8 million lessees will find themselves in need of new wheels.

Last week, Morgan Stanley analyst Adam Jonas forecasted a U.S. sales drop of 9 percent for the year — a steep fall-off from the previously forecast 1-2 percent drop. That puts the annual tally at about 15.5 million vehicles. LMC Automotive sees global sales falling 4 percent in 2020, adding that the virus’ impact could spill over into 2021.

[Image: Audi]

Steph Willems
Steph Willems

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  • Jkross22 Jkross22 on Mar 19, 2020

    I’d imagine that this year’s car sales are going to tank through the end of the year. This virus is nasty and it will keep after us, but the level of panic we’re seeing doesn’t seem to be commensurate with the damage it’s doing. Those repeating bad data or bad news need to cut it out. For example, this is not killing 2-15% of the people who get it. Please stop spreading ignorance. These overreactions are making people act stupidly.

    • See 1 previous
    • Maymar Maymar on Mar 19, 2020

      How many people do you think the health care system can handle? That's the real cause for concern, just to keep this manageable (and to hope not too many health care providers contract this as well).

  • Michael S6 Michael S6 on Mar 19, 2020

    Probably a very good time to buy a car. However, if auto production shuts down for long periods then supply issues will keep prices from falling down.

  • CanadaCraig You can just imagine how quickly the tires are going to wear out on a 5,800 lbs AWD 2024 Dodge Charger.
  • Luke42 I tried FSD for a month in December 2022 on my Model Y and wasn’t impressed.The building-blocks were amazing but sum of the all of those amazing parts was about as useful as Honda Sensing in terms of reducing the driver’s workload.I have a list of fixes I need to see in Autopilot before I blow another $200 renting FSD. But I will try it for free for a month.I would love it if FSD v12 lived up to the hype and my mind were changed. But I have no reason to believe I might be wrong at this point, based on the reviews I’ve read so far. [shrug]. I’m sure I’ll have more to say about it once I get to test it.
  • FormerFF We bought three new and one used car last year, so we won't be visiting any showrooms this year unless a meteor hits one of them. Sorry to hear that Mini has terminated the manual transmission, a Mini could be a fun car to drive with a stick.It appears that 2025 is going to see a significant decrease in the number of models that can be had with a stick. The used car we bought is a Mk 7 GTI with a six speed manual, and my younger daughter and I are enjoying it quite a lot. We'll be hanging on to it for many years.
  • Oberkanone Where is the value here? Magna is assembling the vehicles. The IP is not novel. Just buy the IP at bankruptcy stage for next to nothing.
  • Jalop1991 what, no Turbo trim?
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