What have you always wondered about the economy? Tell Us
COVID-19

What’s been driving strong auto sales?

Mitchell Hartman Nov 3, 2020
Heard on:
HTML EMBED:
COPY
People look to buy a car at a dealership in New Jersey shortly after it reopened in May. Spencer Platt/Getty Images
COVID-19

What’s been driving strong auto sales?

Mitchell Hartman Nov 3, 2020
Heard on:
People look to buy a car at a dealership in New Jersey shortly after it reopened in May. Spencer Platt/Getty Images
HTML EMBED:
COPY

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

What’s the outlook for vaccine supply?

Chief executives of America’s COVID-19 vaccine makers promised in congressional testimony to deliver the doses promised to the U.S. government by summer. The projections of confidence come after months of supply chain challenges and companies falling short of year-end projections for 2020. What changed? In part, drugmakers that normally compete are now actually helping one another. This has helped solve several supply chain issues, but not all of them.

How has the pandemic changed scientific research?

Over the past year, while some scientists turned their attention to COVID-19 and creating vaccines to fight it, most others had to pause their research — and re-imagine how to do it. Social distancing, limited lab capacity — “It’s less fun, I have to say. Like, for me the big part of the science is discussing the science with other people, getting excited about projects,” said Isabella Rauch, an immunologist at Oregon Health & Science University in Portland. Funding is also a big question for many.

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.”

Read More

Collapse

News and information you need, from a source you trust.

In a world where it’s easier to find disinformation than real information, trustworthy journalism is critical to our democracy and our everyday lives. And you rely on Marketplace to be that objective, credible source, each and every day.

This vital work isn’t possible without you. Marketplace is sustained by our community of Investors—listeners, readers, and donors like you who believe that a free press is essential – and worth supporting.

Stand up for independent news—become a Marketplace Investor today with a donation in any amount.