Even with challenges brought by the COVID-19 health crisis, Edmunds analysts indicate that Q3 marks a “positive turning point” for the automotive space. They anticipate that 3,850,707 new cars and trucks will be sold domestically, marking a 11 percent drop from Q3 2019 and a 30.6 percent rise compared to Q2 2020, according to an announcement.
Edmunds Executive Director of Insights Jessica Caldwell said in the announcement that consistently lower interest rates inspired new-car purchasers, who were not as likely to be negatively financially impacted by COVID-19, to decide to buy. She also noted that increasing used vehicle prices likely made the new car market more attractive to purchasers who were not feeling sure about buying new or used.
Additionally, those who own cars had the ability to harness the “extra value” that trade-ins were getting amid COVID-19 to help defray the cost of the buy, according to Caldwell.
“Third-quarter sales make at least two things apparent: Most of the doomsday scenarios forecasted at the beginning of the pandemic fortunately did not hold true, and the American consumer stepped up to become one of the many heroes in this chapter of resilience for the automotive industry,” Caldwell said.
Edmunds analysts also indicate that fleet sales keep having difficulty amid COVID-19. The company forecasts that fleet transactions will comprise 10.8 percent of overall sales for Q3 in contrast to 17.2 percent in Q3 2019 and 13.2 percent last quarter.
“Daily rental companies have understandably reduced or delayed orders as Americans continue to stay at home rather than embark upon business or air travel. It will likely take a bit longer for this side of the business to make as dramatic a comeback as its retail counterparts,” Caldwell said.
The news comes as the process of purchasing a car keeps undergoing its own digital reinvention. Funds and attention are geared less toward trends such as hybrids or electric vehicles and more on car-buying at an appropriate distance.