The pandemic is weighing down quarterly sales of GM and Fiat Chrysler – Zonebourse.com

New York (awp / dpa) – Sales of new cars from US manufacturers unsurprisingly fell in the third quarter, hit by the coronavirus pandemic that crippled the US economy and confined households to their homes.

General Motors (GM), the country's largest manufacturer, has sold 665,192 vehicles in the past three months, down 10% compared to the same period in 2019, according to a statement released Thursday.

Its competitor FCA US (ex-Chrysler) recorded a decline in sales of the same magnitude, totaling a total of 507,351 new registrations.

If they note that sales had fallen drastically in July, the two manufacturers indicate having observed a rebound in August and September as the States slowly reopened their economies.

As a result, they expect the sector as a whole to jump 4 million more cars sold in the third quarter compared to the second quarter, the most affected by the measures to stem the spread of Covid-19.

"If the economy rebounded substantially in the third quarter, the recovery is even more spectacular for auto sales," said Elaine Buckberg, chief economist at GM, quoted in the press release.

Demand has been boosted in recent weeks by low interest rates and the ability of dealers to convince households to shift their vacation budgets to buying a new car, despite economic uncertainties.

Some dealers have organized private sales and many of them have targeted urban residents who are reluctant to use public transport.

“People living in cities have shown a lot of interest in eventually owning a car not only because some are moving to the suburbs but also because others are now taking weekend getaways on a regular basis,” says GM.

This movement has particularly boosted demand for SUVs (city SUVs) and large pickups: the Chevy Blazer model and Cadillac XT6 have seen their sales explode by more than 46% in the last three months, says GM.

Car sales "are holding up in view of stocks which are at much lower levels than a year ago", comments Charlie Chesbrough, expert at Cox.

"Can this continue? Clearly first-time buyers have not yet been severely affected by the recession (…), so demand should probably stabilize in the short term," he concludes.

Ford and Tesla, the other two major American automakers, had yet to release their sales figures at midday Thursday.

afp / rp

Categories Cars

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