Major automakers are reporting 2020 first-half sales approximately 20% lower than 2019's in large part to weak fleet orders, but said consumer demand remained in the face of the ongoing coronavirus pandemic.
The outlook for sales growth in 2020 remains dim as summer lockdowns loom. TrueCar's ALG reported an estimated SAAR of 13 million vehicles in June; some analysts have speculated the year-end figure could fall closer to 12 million.
"This quarter demonstrated the resilience of the U.S. consumer," said Jeff Kommor, head of U.S. sales at FCA, as the automaker reported a 39% slump in sales for the second quarter. "Retail sales have been rebounding since April as the reopening of the economy, steady gas prices, and access to low interest loans spur people to buy."
U.S. auto production was shut down for two months in the spring as part of efforts to thwart the spread of the novel coronavirus. That has left automakers scrambling to ramp up production again to boost low dealer inventories.
Ford claimed its best retail share in five years Thursday when it announced total sales decreases of more than 33% for the second quarter and 23% for the year. Last year's discontinuation of the Ford Focus and Fiesta left a roughly 24,000-unit hole in Ford's 2020 figures, while the introduction of the Ranger helped buoy the company's truck sales slightly.
"GM entered the quarter with very lean inventories and our dealers did a great job meeting customer demand, especially for pickups," Kurt McNeil, U.S. vice president for sales at General Motors. "Now, we are refilling the pipeline by quickly and safely returning production to pre-pandemic levels."
GM said its efforts to rebuild dealer inventory levels included working with logistics and trucking companies to make sure vehicles ship as soon as they roll off the production line. GM posted a pandemic-fueled 34% decline in second-quarter sales, but noted while April sales were down about 35% versus the same month in 2019, May and June saw declines of around 20% or less.
"Our resilient sales reflect an improving demand curve," McNeil said.
While U.S. consumer demand for new vehicles has rebounded surprisingly quickly despite the economic ravages wrought by COVID-19, fleet sales to rental car companies, corporations and government agencies have dragged overall sales down. Recovery for those sales is expected to be slow, while the future of the rental car industry is uncertain.
Volkswagen reported a 29% drop in Q2, compounding a 22% decline so far for 2020. The only vehicle in its portfolio outpacing 2019 sales is the Arteon, which improved by 33% to 797 units in the second quarter.
Hyundai said that while its overall sales fell 22% in June, sales to consumers rose 6% versus June 2019, while its fleet sales plummeted 93%. Luxury subsidiary Genesis reported a nearly 25% drop compared to last June, but said customers are coming back; its flagship G90 executive sedan is beating its 2019 sales performance through June.
"Despite a steep decline in the luxury market, Genesis increased sales significantly over last month," said Mark Del Rosso, president and chief executive officer, Genesis Motor North America.
FCA's Kommor said fleet sales "remained low" during the quarter as FCA "prioritized vehicle deliveries to retail customers."
"As a result, we have built a strong fleet order book which we will fulfill over the coming months," he added.
Toyota Motor Corp reported a 26.7% drop in sales in June, though sales for some SUV models were up versus the same month in 2019. Mazda checked in with a 17-percent drop in the second quarter, but is down only just under 11% so far in 2020.
Nissan continues to struggle, reporting a 39-percent decline for group sales through June.
(Additional Reuters reporting by Ankit Ajmera and Sanjana Shivdas in Bengaluru, Ben Klayman in Detroit; Editing by Shinjini Ganguli and Bernadette Baum)