Auto Sales Continue to Increase, Recovery Underway

Auto Sales Continue to Increase, Recovery Underway

The automotive industry appears to have left its worst days behind, according to a new report from J.D. Power.

April has shown three straight weeks of improved sales. While sales remain below pre-virus numbers, April sales are so far a full 11 percentage points higher than at the end of March. Moreover, sales are up in every major U.S. market.

The budding recovery is largely due to aggressive incentives and the relaxing of stay-at-home orders to allow for auto sales. Currently, 24 states permit showroom sales, while the other 26 allow online sales only. Experts predict that May will be a pivotal month for the industry.

Federal Government Declares Auto Sales Essential

Dealerships gained a victory on April 17 when the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency designated auto sales an essential business.

The update to the Essential Critical Infrastructure Workers Guidance 3.0 means that dealerships as a whole may begin operating again. The guidelines had already given service departments the green light to stay open. Now, the feds have paved the way for state and local governments to offer similar designations.

Ultimately, it will be states and local authorities that decide when in-person sales and leasing can resume. But this new amendment comes as good news and an indication that dealers everywhere could go back to business in the near future.

Pandemic Could Alter Car Designs

As much of the auto industry has ground to a halt, vehicle designers have remained relatively unencumbered. The latest predictions from designers offer an interesting view of how vehicle interiors and exteriors could be altered because of COVID-19.

The interior of an automobile has always represented a safe space, but consumers are more interested than ever in staying protected. Already, brands in some Asian markets with heavy pollution offer top-rated air purification systems. Infiniti’s M line takes it a step further by removing pathogens in addition to pollutants.

This trend is already taking place in luxury brands. Jaguar has indicated its aim to make vehicle interiors comparable to a mobile spa, and many high-line brands include features like massagers and fragrance. But such innovations aren’t solely limited to luxury. In 2017, Toyota patented a cloaking technology to help drivers see through A-pillars. An expansion of this technology has been explored by Mercedes and could lead to exterior cloaking capabilities as well, designers indicate.

In any case, there is no question that consumers are putting an increased focus on personal safety and well-being. Moving forward, these enhanced privacy and safety features may just become par for the course.

We’ll be back next week with the latest on COVID-19 news and strategies for dealers.

– Your friends at Strong Automotive Merchandising