Tag: auto sales

By on May 22, 2020

Michigan auto dealers will be allowed to resume in-person sales on Tuesday, according to the latest in a long list of executive orders signed by Gov. Gretchen Whitmer. The state, which harbors the fourth-highest coronavirus death toll in the country (following New York, New Jersey, and Massachusetts), has enacted some of the strictest countermeasures in the country.

This has created no shortage of pressure to both reopen Michigan so life/business can return to normal and maintain closures to avoid further contagion risks. Obviously, that’s proven difficult to do. All steps taken towards reopening come with conditions, including those established for Michigan’s dealerships.

But first, some backstory.  (Read More…)

By on May 11, 2020

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.   (Read More…)

By on May 7, 2020

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.  (Read More…)

By on May 5, 2020

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.  (Read More…)

By on April 20, 2020

Updated social distancing guidance released by the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (CISA) on Friday indicates the automotive industry is now an essential business.

Version 3.0 (for those keeping count) of what constitutes “essential critical infrastructure workers” added a number of job descriptions as the federal government mulls how to restart the U.S. economy. Among them is pretty much every job related to automotive manufacturing and sales. (Read More…)

By on April 9, 2020

Mercedes-Benz got out in front of BMW while automotive sales languish in the gutter, though neither company finds itself resting comfortably upon a bed of roses. The global pandemic has made sure of that; no segment has gone unaffected by social distancing measures, but it may be the luxury divisions that have it the hardest moving forward.

Up until recently, premium nameplates had done rather well — scooping up an increasing share of the total auto market for years. While the Great Recession momentarily suppressed their ascension in 2008 and 2009, it was a temporary setback.

Luxury brands have had a good decade overall, with any rough years being offset by expansions in their lineup (chiefly crossover vehicles). Now they’re trying to move downmarket to capitalize on younger customers with a bit more pocket money. It might have been a good strategy, were it not for the coronavirus outbreak and subsequent economic downturn.  (Read More…)

By on April 8, 2020

With China serving as the flashpoint of the coronavirus outbreak that brought the world down a peg or two, industry and financial analysts have been watching that market like a hawk. The country went into this crisis before any other, which may prove useful for predicting the general path of global recovery efforts.

Unfortunately, specious reports about the number of infected citizens inside that nation have cast a double-quilted blanket of doubt over its official statistics. We don’t actually know if the Chinese government has effectively wrangled the illness or is just hoping to win an international public relations battle. Fortunately, infection rates and death tolls aren’t the only metrics we have to rely on.

According to the China Passenger Car Association, auto sales plummeted by as much as 96 percent since COVID-19 began its relentless spread. This came after months of negative sales growth, leaving the Chinese market in a truly unenviable situation once mandatory quarantines were enacted. Now, circumstances have changed. Showrooms are reopening and many factories have resumed operations, only this time they’re the ones that have to worry about supply chain issues.  (Read More…)

By on April 7, 2020

Auto loan terms have been creeping up for as long as anyone can remember. Back in 1997, the average financing period on a new car was somewhere around 54 months. That crept up to over 60 months by 2004 and has only continued to climb. Over the past decade, the typical automotive loan term has ballooned by almost 30 percent. According to an analysis by Edmunds, the average financing period on a new vehicle sold in the United States surpassed 70 months in March of 2020.

While automakers’ recent introduction of loans extending up to 7 years (especially now that COVID-19 is hampering sales) has exacerbated the issue, we were already sitting on a 69-month average in October of 2019. Why would someone voluntarily agree to such a lengthy agreement? They may not have much of an alternative due to similar growth in vehicle transaction prices.  (Read More…)

By on April 3, 2020

Mirroring its southern neighbor, Canadian auto sales took a dive last month as measures designed to slow the spread of COVID-19 went into effect across the country. First-quarter volume, as a result, fell roughly 20 percent across the industry, with March’s decline pegged at 48 percent by DesRosiers Automotive Consultants (via Bloomberg).

Still, amid all the gloom were statistical bright spots. (Read More…)

By on April 2, 2020

We told you yesterday how zero-interest financing exploded in popularity in the final two weeks of March, as governments everywhere belatedly clamped down and automakers had to pull out all the stops to lure frightened buyers out of their homes. Despite many would-be buyers not taking the bait, for some, zero-percent/84-month loans proved as irresistible as topless pics of a young starlet on the beach.

At the same time, drivers who stood no chance of netting that coveted no-interest loan were also headed to dealers. (Read More…)

By on March 26, 2020

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The growing movement to ditch monthly sales reporting in favor of quarterly updates will blur the impact of this month’s coronavirus-related shelter-in-place orders.

Many automakers, the Detroit Three most notably, left monthly sales reports in the dust long ago, meaning the March decline will have to mingle with the business-as-usual months that preceded it. Right now, it’s left to analysts to tell us the damage.

One has a good idea of what happened this month. (Read More…)

By on March 23, 2020

BMW dealers are having a problem with the 8 Series. The returning flagship appears to be a bit too rich for North American tastes and retailers are growing annoyed.

According to Automotive News, retailers are upset that BMW didn’t issue enough marketing support to make the public aware that it even exists, and feel that the amount of configuration available works against the vehicle. As a result, many dealerships are sitting on expensive halo vehicles nobody seems to want; the 8 Series now has the highest day supply of any BMW model currently produced.  (Read More…)

By on March 17, 2020

As we attempt to wean ourselves off endless discussions the new coronavirus, we’ve noticed there’s not exactly a glut of alternative news out there. Trade shows are being delayed, factories are being idled, and the whole world seems to be in standby mode as we attempt to stall the spread of COVID-19 following its migration out of China.

Regional quarantines in Asia were already doing a number on supply chains, and it wasn’t long before manufacturers around the world began idling production to further slow the virus’s spread. By the beginning of March, it was becoming quite clear that auto sales would suffer significant impacts as people spent the next several weeks isolated in their own homes. Now, the push is on to assess just how much this whole ordeal will impact an OEM’s bottom line.  (Read More…)

By on February 18, 2020

2019 Honda Odyssey - Image: HondaSales of minivans in the United States in 2019 plunged below Great Recession levels as every member of the existing quintet reported sharp year-over-year declines.

The 408,982 sales produced by the Dodge Grand Caravan, Chrysler Pacifica, Honda Odyssey, Kia Sedona, and Toyota Sienna in calendar year 2019 were a far cry from the 1.1 million sales produced by the sector in 2005, or even the 553,506 sold three years ago. But after hovering just below or above 3 percent of the market for half a dozen years, and after overall volume showed signs of recuperation through the middle half of the last decade, the segment’s 2019 collapse suggests we haven’t reached bottom yet.

At the current rate of decline, America won’t even acquire 300,000 minivans next year.

It’s a shame.  (Read More…)

By on February 17, 2020

Thanks to the ongoing coronavirus outbreak in China, the Beijing auto show has reportedly been postponed. While the event was supposed to take place at the end of April, making its yearly trade with the similarly biannual Shanghai trade show, organizers have decided it’s not worth the risk.

Over 70,000 people have reportedly contracted the virus thus far, with the death toll estimated to be somewhere around 1,700. The White House recently said it did not have “high confidence in the information coming out of China,” estimating higher figures. Travel and shipping bans further complicate the matter. Germany’s Automobilwoche said exhibitors wouldn’t be able to ship displays into the country anyway, referencing health notices sent to global logistics organization CIETC.  (Read More…)

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