https://jalopnik.com/it-is-extremely...now-1842455817
Dealers, I wrote last week, are in a bit of bind, with a lot of people not buying new cars in the face of potential economic doom, and showrooms mostly vacant as people social distance themselves amid a global pandemic. It’s probably going to only get worse.
It’s hard to know what to start with in this new Automotive News story about how bad dealerships have it, but maybe let’s start with some numbers:
J.D. Power predicted a 1.7 percent decline in the daily selling rate for March, and the week ending March 8 was about as expected. But then, over the next four days, sales trailed the projected pace by 8 percent. Then, on March 13 and March 14, the deficit grew to 20 percent, and by March 15, it was 36 percent below the baseline projection.
J.D. Power is forecasting March sales will drop as much as 41 percent from a year ago. The company initially predicted U.S. sales of 16.8 million this year, but its new forecast is between 14 million and 16 million.
And here is the problem on the ground level, where people who might have purchased cars even a week ago are pulling the plug, even sometimes after telling dealers that they would but before signing. A new Chevy Equinox was the casualty in one such deal, though if we’re being honest that was probably for the better.
Since March 13, the coronavirus has cost the group four sales.
One man knew that his retirement savings had taken a hit and was no longer able to commit to the purchase of a new Chevrolet Equinox, [Aaron Koehn, owner of Ed Koehn Automotive Group near Grand Rapids, Michigan] said.
“He hadn’t signed anything yet, but he still felt terrible because he had made a commitment to us,” Koehn said.
Another customer, who had nearly completed a deal, backed out because his hotel job went from full time to part time because of the pandemic. A new car was no longer in his budget. Koehn said customers are scared of their current financial state and unsure how they will come out of the situation.
“We’re all feeling this together, so it’s hard not to have some compassion,” he said.
And in East Texas, where Fernando Varela has three Ford dealerships and one Chevrolet-Buick-GMC-Cadillac store, business was humming along until Wednesday, March 18. That’s when “traffic just stopped,” Varela said.
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