We’re in the middle of a historic election, and the economy keeps chugging along. We get an update on an important sector for both manufacturing and retail spending Tuesday: sales numbers for cars and trucks in October.
In spite of the pandemic, auto sales have been strong in recent months.
Back in April, with COVID-19 surging and the economy shutting down, production at auto plants dropped precipitously. Automakers retooled to be COVID-safe, and by May they’d started ramping up production again.
But Kristin Dziczek, vice president of industry, labor and economics at the Center for Automotive Research, said there still aren’t enough vehicles on dealer lots to meet demand.
“If you need a truck right now, you’re going to take the one that meets your criteria right now at the price they’re offering it, or you might be waiting a few months,” she said.
Still, with millions out of work and earning less, who’s buying?
Garrett Nelson, senior equity analyst at CFRA Research, said it’s primarily higher-income Americans in cities and suburbs.
“While they might be working from home, they need that vehicle to do their errands,” he said. “Maybe they had really not seen an automobile as a necessity before, whereas, because of the pandemic, they do now.”
He said with people shunning buses, Ubers, trains and planes, a lot of consumers want their own set of wheels.
COVID-19 Economy FAQs
Pfizer said early data show its coronavirus vaccine is effective. So what’s next?
In the last few months, Pfizer and its partner BioNTech have shared other details of the process including trial blueprints, the breakdown of the subjects and ethnicities and whether they’re taking money from the government. They’re being especially transparent in order to try to temper public skepticism about this vaccine process. The next big test, said Jennifer Miller at the Yale School of Medicine, comes when drug companies release their data, “so that other scientists who the public trust can go in, replicate findings, and communicate them to the public. And hopefully build appropriate trust in a vaccine.”
How is President-elect Joe Biden planning to address the COVID-19 pandemic and the economic turmoil it’s created?
On Nov. 9, President-Elect Joe Biden announced three co-chairs of his new COVID-19 task force. But what kind of effect might this task force have during this transition time, before Biden takes office? “The transition team can do a lot to amplify and reinforce the messages of scientists and public health experts,” said Dr. Kelly Moore, associate director for the Immunization Action Coalition. Moore said Biden’s COVID task force can also “start talking to state leaders and other experts about exactly what they need to equip them to roll out the vaccines effectively.”
What does slower retail sales growth in October mean for the economy?
It is a truism that we repeat time and again at Marketplace: As goes the U.S. consumer, so goes the U.S. economy. And recently, we’ve been seeing plenty of signs of weakness in the consumer economy. Retail sales were up three-tenths of a percent in October, but the gain was weaker than expected and much weaker than September’s. John Leer, an economist at Morning Consult, said a lack of new fiscal stimulus from Congress is dampening consumers’ appetite to spend. So is the pandemic.