DETROIT (AP) – Sales of new vehicles in the U.S. fell 14.6% last year, but a second-half rebound due to a coronavirus-related dip in the spring has optimism for a recovery later late this year.
Car manufacturers reported on Tuesday that they had sold 14.57 million new vehicles for the year, a far from the previous five years with sales of more than 17 million. But performance in 2020 was better than most forecasters expected when the pandemic had to shut down car factories and many dealers in April and May.
General Motors chief economist Elaine Buckberg said she expects sales to recover in the spring. With the warmer weather and the increasing vaccinations against coronavirus, life should return to normal, which increases the labor market and the demand for cars, she says in a statement.
“We feel like there’s light at the end of the tunnel,” said Randy Parker, vice president of sales at Hyundai Motor America. “I think it’s going to be a solid year.”
But Parker said he is still cautious, with hospitals overflowing in California and cases increasing in other states. “It’s far from over,” he said. “At this stage we can not afford to let our guard down.”
Last spring, unemployment skyrocketed when states closed down and introduced other measures to curb the spread of the virus. Car sales tumbled 34% in the first half of the year when factories closed for about two months, cutting off supply of new vehicles.
But as summer dawned, people began to haunt cars, trucks, and SUVs late in the year. That and the low interest rates boosted sales and pushed the average car sales price to a record high of just over $ 38,000 in December, according to JD Power. Also in December, sales increased by 5% compared to the same month in 2019, and GM said sales have improved every month since May.
“Those who have not been financially affected by the pandemic are spreading funds from travel to home improvement, home purchases and vehicles,” said Jeff Schuster, president of the global vehicle forecasting firm for the LMC Automotive consulting firm.
Car manufacturers have not yet been able to compensate for the production lost during their factory closure, and this has limited the stock and limited the choice of buyers to more expensive vehicles, Schuster said.
Retail sales to individual buyers are close to normal levels, but sales to fleet buyers such as rental car companies are still lower.
Analysts believe the higher prices and the narrow stock will not change much soon.
“These factors will continue until 2021, with demand lagging behind and reflected in higher prices for new and used vehicles,” said Karl Brauer, executive analyst at the iSeeCars.com car website.
Schuster said he expects sales to rise to $ 15.7 million in 2021 this year as inventories improve in the second and third quarters. He does not expect a return on 17 million until at least 2024.
Among automakers, GM’s sales for the year fell 11.9%, while Toyota’s sales fell 11.4%. Ford fell 15.4%, while Fiat Chrysler fell 17.4%. Struggling Nissan fell sales by 33.2% for the year, while Honda fell by 16.3% and Hyundai’s sales fell by 10%. Volkswagen Group fell 12.8%, while Subaru’s sales fell 12.6%.
According to Autodata Corp., sales of fully electric vehicles increased by 9.9% to 260,092.
Car sales fell and fell to 28.3% of the market, with trucks and sports utility vehicles accounting for 71.7%.
Ford’s F-Series pickups remain the country’s top-selling vehicle with 787,422 sales, down 12.2%. The Chevrolet Silverado was second at 586,675, up 2.8%. The Silverado drove the Fiat Chrysler Aries pickup out of the No. 2 slot. It’s past the Silverado in 2019. Toyota’s RAV4 was the top-selling SUV with 430,387 sales, while the Toyota Camry was the most popular car with 294,348 sales.