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The rain has drastically slowed in the automotive community for the month of May 2020. While year-over-year data suggests that there is still progress to be made, sales in the month of May drastically increased over April 2020. 

 In January 2020, 158,657 people showed up to buy a car in Los Angeles. Three months later – only 66,928. A 57.8% decline in sales is totally catastrophic, the impact of which will be felt long after the pandemic has passed. 

The U.S. as a whole lost about 4.6 million customers between March and April 2020 – a decline of 52.8%. According to Cross-Sell data, the average car sold for $23,451.07 (last 10 model years) in January 2020 so that means an economic loss of roughly $108 billion. 

But April showers did bring May flowers – with increases that we have not seen in a while, and certainly once that we were all hoping for. 

Most dealers are probably breathing a sigh of relief to see these increases, but automotive isn’t entirely out of the woods yet. The U.S. as a whole is down 33.9% compared to a year ago. With lingering concern about the pandemic and many states reopening – many buyers will still be hesitant to return to market.

“We recently analyzed three different buyer profiles; Highline buyers, those with an excellent credit score and were unaffected by the pandemic, the Middle Class who are by nature a cautious buyer with a decent credit score and Subprime buyers, those who don’t have great credit who are incentivized by stimulus checks,” says Allen Faith, lead analyst at Cross-Sell. “We believe the subprime buyers already came in and helped keep our dealerships afloat when things were getting really lean in April and May. The highly qualified buyers quickly followed suit and took advantage of the offers that were out there. We believe the middle class is still out there, waiting for the right time to buy.”

Notably, Hertz reported last week that they were planning to dump 30,000 cars into the market to increase their cash position.

“This may be what we need to bring out the middle class buyer,” concludes Faith.

Nearly every car trip results in a transaction or some benefit to our overall quality of life.

The importance of this industry to the overall health of the American economy must never go understated – building 60 million vehicles requires the employment of about 9 million people. Then, there are an additional 50 million jobs estimated downstream which are all owed to the auto industry, according to ocia.net. 

As with most other industries, this one rises and falls with our economy, but with a goliath-like impact. 

Right now, it’s a rainy day in automotive. In January 2020, 158,657 people showed up to buy a car in Los Angeles. Three months later – only 66,928. A 57.8% decline in sales is totally catastrophic, the impact of which will be felt long after the pandemic has passed. 

The U.S. as a whole lost about 4.6 million customers between March and April 2020 – a decline of 52.8%. According to Cross-Sell data, the average car sold for $23,451.07 (last 10 model years) in January 2020 so that means an economic loss of roughly $108 billion. 

If we applied similar numbers to the amount of people who are employed in this industry, we’d see a loss of about 30 million jobs – and job loss has already arrived.

The auto industry is the single greatest engine of economic growth in the world and there are major implications if businesses don’t open – and fast. 

After a review of April 2020 title and registration data, and the impact that COVID-19 has had on the auto industry, even dealerships who have long embodied online sales are struggling to perform. Longo Toyota, the Number 1 selling Toyota dealership in the U.S. sold 428 cars in April 2020 – a stark contrast to the usual 1,600. Worse over, Paragon Honda in New York City sold 37 cars in April 2020, a 93% drop from April 2019. 

The state of Texas, which is responsible for about 6 million annual car sales showed a 58.9% decline in YOY sales according to Cross-Sell data. 

In every gloom, there are glimmers of hope. April 2020 data shows the margin between domestic versus import vehicles sold is narrowing. Cross-Sell data from 24 states shows that 81,660 more imported vehicles sold in the month of February, but only 10,640 more imported vehicles sold in April. Of course, many Americans are employed by import franchises, but this type of trend will help keep the american economy humming. 

Other trends show truck sales remaining steady throughout the pandemic. Two models in particular – the GMC Sierra 1500 and the Chevrolet Silverado have had consistent sales numbers. The GMC Sierra is down only 4.7% from March to April 2020 but up 4.8% for the year. Similarly, Silverado sales declined 14.1% from March to April 2020 but only 5.1% year over year. 

With many states pushing to reopen, it’s hard to believe that car sales will drop again in May 2020 – but it will depend on the consumer’s appetite and ability to transact again.

To learn more about how the pandemic has affected the U.S. auto industry in May 2020, join our upcoming webinar. 

Automotive stakeholders are curious how U.S. auto sales will fare through the coronavirus pandemic.  At Cross-Sell, we took a look at unique markets where the most cases of COVID-19 were reported to see what impact it had on new and used sales. 

The below results reflect seller data in the Los Angeles market. 

Overall, We see a 10.5% drop in March 2020 over March 2019 and a 6.2% drop over February 2020. February is historically not a great month for U.S. auto sales because of the cold weather and the manufacturer incentives that wrap up in January. March typically reflects higher sales from pent-up demand in February. 

Dealer Spotlight: Longo Toyota

Longo Toyota, the iconic No. 1 selling Toyota dealer in the U.S. closed their store from March 17 – March 31, 2020. A message from General Manager Doug Eroh states. “Guests wishing to shop from home can utilize our Express Store on express.longotoyota.com to shop, configure, purchase and arrange home delivery of any new or pre-owned Toyota for April 1, 2020 or after. Guests wishing to have their service performed at their home or office (select services only) can call to arrange mobile service.”

Their sales were only slightly impacted. This suggests that sales in the beginning of March were very strong and tapered off once Longo Toyota closed their store.

With the COVID-19 caseloads still increasing in the U.S. in early April and no clear way to open back up the country, April sales could be gut wrenching. 

Are you interested in seeing what your competitors sold last month?

Fill out the form below to get started.

Automotive stakeholders are curious how U.S. auto sales will fare through the coronavirus pandemic.  At Cross-Sell, we took a look at unique markets where the most cases of COVID-19 were reported to see what impact it had on new and used sales. 

The below results reflect seller data in the Denver market. 

Overall, We see a 27.7% drop in March 2020 over March 2019 and a 29.4% drop over February 2020. February is historically not a great month for U.S. auto sales because of the cold weather and the manufacturer incentives that wrap up in January. 

Dealer Spotlight: Schomp Subaru

Schomp Subaru was certainly expecting bigger numbers in March of 2020, until COVID-19 came. Their new car sales in march of 2020 nearly cut in half from February 2020. The store made it clear to customers that the store would continue the service side of the business as normal, but buying a car required a virtual appointment with a member of their sales team. 

By all accounts, automotive will likely see similar or worse numbers through April 2020 as the COVID-19 case load continues to grow. Denver has less than 1,000 cases and almost 2,000 cases in the surrounding markets. 

Are you interested in seeing what your competitors sold last month?

Fill out the form below to get started.