The sales of new vehicles in the US is expected to come down by at least 15% this year when compared to 2019. This is one of the worst annual declines for the auto industry since 1980.
Coronavirus Has Crippled US Auto Sales In 2020
Considering the numbers, the rapid fall in sales of new vehicles means that the industry is in a crisis situation. However, experts are saying that it could have been worse as they expected the sales to be lower than this number. For the most part of the year, the auto manufacturing units were shut down, and most people did not come out to buy new products.
Auto industry experts are of the opinion that even though 2020 has been a rough year, the auto industry is in a much better place than expected. The early months of 2020 were very good for the entire Auto Industries, and many experts had forecasted a good year for the industry. However, things changed drastically from March onwards after the coronavirus pandemic hit the nation.
The sales of new vehicles collapsed as several auto manufacturing units were shut down across the country. Yet another factor that affected the sales of new vehicles was that most dealers were forced to close down the showrooms for several months. In the month of March, the retail sales were expected to come down by nearly 80%. The situation was expected to continue for many more months, and the sales levels for the year were expected to remain near recession levels.
However, the sales of new vehicles rebounded faster than expected even though the sales during the second quarter went down by nearly 34%. The auto industry also understood the situation and made several changes to boost the sales of new vehicles. Several attractive financial offers were given to consumers, and most of the manufacturers offered low-interest rates. Some companies even offered zero percent interest rates for the new vehicles as they wanted to cash in on the new demand for private vehicles among the public. The pandemic also helped the auto industry as several people preferred to use their own vehicles instead of using public transport due to the fear of coronavirus.
This is a good comeback, and the recovery of retail vehicle sales has surprised many experts in the industry. When the final numbers are out for the year, the auto industry is expecting that the overall sales will be down by close to 15% for the entire year. On the whole, close to 14 million vehicles were sold in 2020, which is a good number considering the pandemic situation. The average for the last five years was around 17 million.
The sales of commercial vehicles fell down by a huge margin when compared to the sales of regular vehicles. This is one of the biggest downfalls for the auto industry for four decades. Even though the initial months were challenging, the auto industry has made a good comeback in the last quarter of the year.
Many experts in the industry say that the demand for individual mobility has picked up by a huge margin after the pandemic. The effect is likely to last for the next few years, and there is a good Shift in demand for passenger vehicles. In this way, the pandemic has helped the auto industry in more ways than any other industry.
The demand for new passenger vehicles is likely to pick up once the economy comes to normal in the next year. As a vaccine for coronavirus is available in the market, the economy is likely to get back on track. The auto industry will also benefit in future with these developments.