#NewCarSales

It seems most Americans are continuing to hang onto their cars for extended periods of time, with a new report suggesting the nation’s average vehicle age is 12.5 years. According to the crew at S&P Global Mobility, it’s the sixth straight year this number has increased.

We’re coming out of a few lean years in the auto industry. Automakers, struggling to keep pace with demand due to supply chain issues and a global pandemic, slashed incentives and even increased prices in some cases. Things are starting to calm down, at least a little, and the deals are slowly returning. 

You've likely heard about the craziness that's happening at car dealerships right now. We've reported on insane markups, for example. And I've heard whispers, anecdotally, that so-and-so's friend's co-worker's cousin who's going with this girl who works at 31 Flavors got screwed when trying to buy a new car.

In March, vehicle miles traveled (VMT) rebounded to pre-pandemic levels. According to the Auto Care Association, this was the first month since August 2019 that VMT topped 300 million miles. To give you some perspective, the distance between the earth and the moon is only 238,856 miles, according to Wikipedia.

Color counts when selling or buying a car. But which colors help or hurt? iSeeCars.com, a car search engine, performed exhaustive research on this topic, recently publishing the results.

Jan, Toyota’s innocuous ad spokesperson, poses our question of the day (QOTD) to picture yourself in a new Toyota. We’re asking, what new vehicle of any make would you picture yourself in? Assuming, of course, dealers still exist.

Car dealerships are a conundrum. For decades, they’ve prevailed despite changes in every aspect of what occurs at a new car dealership. The big question is whether they will continue doing business as they have, or will there be changes to a system that’s out of touch with buyers today?

Rivian’s plan to sell vehicles directly to consumers has raised the ire of two auto-dealer groups in Illinois.

BMW of North America today reported falling BMW and Mini U.S. fourth quarter and full-year 2020 sales.

Forget all you’ve heard about Millennials (24-39 years old) and their disdain for automobiles. COVID-19 has changed that, as 31 percent of those without a car intend to buy one in the next six months, and 45 percent of them are Millennials.

EY, a global leader in assurance, tax, strategy, and consulting services, and a member of Ernst & Young Global Limited, issued their 2020 EY Mobility Consumer Index, surveying over 3,300 consumers across nine countries. Thirty-one percent of the respondents who don’t own a car plan to buy one in the next six months, while 20 percent that already own a car say they would be open to buying another vehicle. Both groups said that one of their principal reasons to purchase is the pandemic.

Better than 16 percent of the new vehicles sold in the United States in the third quarter of 2020 were full-size pickup trucks, an increase created by relatively steady truck sales in an unsteady world.

And who’s to thank? Ford, primarily.

Having already pulverized the dead horse of waning auto sales into a fine paste, we’ll now turn our focus on how it’s impacting employment among automotive retailers — squashing another pony.

Much of the information up until this point has been anecdotal and conditional to the North American response to COVID-19. Furloughs were rampant as the pandemic progressed and new safety rules seemed poised to cripple sales moving forward. There was an obvious general plight confronting automotive retailers, but we couldn’t nail down what that meant in terms of job losses.

We still don’t, frankly. But it is starting to become obvious that there isn’t much reason to be exceptionally optimistic. AutoNation recently announced that around half of the 7,000 workers it furloughed in April won’t be coming back. Despite some retailers claiming not to need such drastic cuts, plenty are following AutoNation’s model. With fewer customers and sweeping restrictions on how showrooms can be operated, there’s little reason for there to be all hands on deck. But just how many will be forced to abandon ship this year?

Chinese auto sales grew 4.4 percent last month vs a year earlier, rising to 2.07 million vehicles, according to tabulations released by the government-backed China Association of Automobile Manufacturers (CAAM) on Monday. This is actually better than its preliminary assessment suggested, with the new figure helping put an end to a 21-month slump of declining automotive sales.

Unfortunately for the region, it doesn’t seem to be indicative of a full recovery. In its report, CAAM noted that the rebound may be only temporary. Last month’s figures were primarily elevated by commercial vehicles, which saw record growth at 32 percent (year over year). Passenger vehicles also saw their numbers improve from the month prior, but they still down 2.6 percent in April. The improvement is widely seen as the result of backlogged orders that couldn’t be completed during the most prohibitive period of the pandemic, as well as the Chinese Communist Party ordering more work vehicles to stimulate the economy.

The China Association of Automobile Manufacturers (CAAM) reports that April was healthier than expected, resulting in an estimated 2 million new vehicle sales. This would be the first time in a couple years the market has seen any monthly growth, with CAAM taking to the Tencent-owned WeChat to announce a single-percent gain over April 2019.

Considering the pandemic is anticipated to suppress global auto sales by anywhere from 10 to 20 percent, it seems premature to call anything a victory. Likewise, influence from the Chinese Communist Party has made any statistics coming out of the country highly suspect. Much of the world is currently under the impression that the nation’s leadership is in an all-out effort to project the country’s strength after failing to share helpful information in a timely manner and downplaying its coronavirus-related deaths. We don’t know what information is credible, especially since all groups (which includes individuals, state institutions, and corporations) are required by law to have direct ties to China’s only political party.

So that’s it then? It’s all bunk? Not quite. While there are plenty of reasons to doubt information coming out of China, there are also reasons to buy what CAAM is selling.

With COVID-19 lockdowns suppressing auto sales around the globe, everyone expected April to be a rough month. However, we doubt the United Kingdom expected monthly deliveries to come in at the lowest level since the end of World War II. Registrations for April peaked at 4,321 in the UK, representing the lowest monthly figure since 1946 — when the nation was still rationing materials as it attempted to rebuild after a prolonged military conflict (and factories were just starting to transition back to manufacturing passenger vehicles).

While it’s possible some registrations are simply delayed, the Society of Motor Manufacturers and Traders (SMMT) says it doesn’t believe that to be a significant factor. Retailers typically register the vehicle for you and, with with precious little else to do, you’d think they’d have finished whatever paperwork they had lying around. Most of them, of course, weren’t capable of operating normally due to government mandates, allowing the few outlets offering at-home delivery to make up the lion’s share of sales.