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
How many people are flying? Has traveled picked up?
Flying is starting to recover to levels the airline industry hasn’t seen in months. The Transportation Security Administration announced on Oct. 19 that it’s screened more than 1 million passengers on a single day — its highest number since March 17. The TSA also screened more than 6 million passengers last week, its highest weekly volume since the start of the COVID-19 pandemic. While travel is improving, the TSA announcement comes amid warnings that the U.S. is in the third wave of the coronavirus. There are now more than 8 million cases in the country, with more than 219,000 deaths.
How are Americans feeling about their finances?
Nearly half of all Americans would have trouble paying for an unexpected $250 bill and a third of Americans have less income than before the pandemic, according to the latest results of our Marketplace-Edison Poll. Also, 6 in 10 Americans think that race has at least some impact on an individual’s long-term financial situation, but Black respondents are much more likely to think that race has a big impact on a person’s long-term financial situation than white or Hispanic/Latinx respondents.
Find the rest of the poll results here, which cover how Americans have been faring financially about six months into the pandemic, race and equity within the workplace and some of the key issues Trump and Biden supporters are concerned about.
What’s going to happen to retailers, especially with the holiday shopping season approaching?
A report out recently from the accounting consultancy BDO USA said 29 big retailers filed for bankruptcy protection through August. And if bankruptcies continue at that pace, the number could rival the bankruptcies of 2010, after the Great Recession. For retailers, the last three months of this year will be even more critical than usual for their survival as they look for some hope around the holidays.
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