Vehicle sales crash in April, analysts say, dropping by half
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It looks like vehicle sales sank to a record low in April. Figures from some of the automakers are due out later Friday, but analysts expect to see a drop of more than 50% compared to this time last year.
The sales figures could be worse than the previous low in January 2009, at the depths of the financial crisis. Analysts’ figures show that around 625,000 vehicles were sold in April.
But the over-50% drop-off isn’t as bad as China saw at the height of its COVID-19 lockdown. Eric Lyman, chief industry analyst at TrueCar, said sales dropped 80% there.
For some U.S. shoppers, the coronavirus may have actually driven a car purchase.
“We know that public transportation is something people are shying away from,” Lyman said. “We know that the vehicle is an integral part to our American life.”
Sales held up better in parts of the county with less strict stay-at-home measures. Michelle Krebs, executive analyst at Autotrader, said people with incomes in the $50,000 to $99,000 range are doing most of the buying, and pickup trucks continue to be popular purchases.
People hold on to trucks for up to a decade, Krebs said, so recent incentives have been very popular.
“Zero-percent financing for 84 months — it works really well with trucks,” Krebs said.
Analysts say April’s figures should be as low as sales go, and they could recover, even if only modestly, in May.
COVID-19 Economy FAQs
So what’s up with “Zoom fatigue”?
It’s a real thing. The science backs it up — there’s new research from Stanford University. So why is it that the technology can be so draining? Jeremy Bailenson with Stanford’s Virtual Human Interaction Lab puts it this way: “It’s like being in an elevator where everyone in the elevator stopped and looked right at us for the entire elevator ride at close-up.” Bailenson said turning off self-view and shrinking down the video window can make interactions feel more natural and less emotionally taxing.
How are Americans spending their money these days?
Economists are predicting that pent-up demand for certain goods and services is going to burst out all over as more people get vaccinated. A lot of people had to drastically change their spending in the pandemic because they lost jobs or had their hours cut. But at the same time, most consumers “are still feeling secure or optimistic about their finances,” according to Candace Corlett, president of WSL Strategic Retail, which regularly surveys shoppers. A lot of people enjoy browsing in stores, especially after months of forced online shopping. And another area expecting a post-pandemic boost: travel.
What happened to all of the hazard pay essential workers were getting at the beginning of the pandemic?
Almost a year ago, when the pandemic began, essential workers were hailed as heroes. Back then, many companies gave hazard pay, an extra $2 or so per hour, for coming in to work. That quietly went away for most of them last summer. Without federal action, it’s mostly been up to local governments to create programs and mandates. They’ve helped compensate front-line workers, but they haven’t been perfect. “The solutions are small. They’re piecemeal,” said Molly Kinder at the Brookings Institution’s Metropolitan Policy Program. “You’re seeing these innovative pop-ups because we have failed overall to do something systematically.”
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