Hot Tickets: The Fastest-Selling New Cars in The Pandemic Age Aren’t Cars

First Up 08/05/20

Aug. 5, 2020

Hot Tickets: The Fastest-Selling New Cars in The Pandemic Age Aren’t Cars

With the auto industry still in the process of dusting itself off after being hit hard by COVID-19 shutdowns and shelter-in-place orders, most new and used vehicles are taking longer to sell than in pre-pandemic days. But, according to Forbes, there are bright spots poking through otherwise cloudy skies, with some models spending far less time than others sitting on dealers’ lots. Sport-utility vehicles continue their industry dominance, representing 11 out of 12 models on the list of the speediest-sellers. The list of hottest used vehicles are more of a mixed bag in terms of market segments, with passengers cars and SUVs almost equally represented. Click here to see both lists. “The number of days a new car remains in the marketplace provides an indication of the demand for the vehicle,” explains iSeeCars CEO Phong Ly. “A quick selling time could be because of buzz surrounding a new model because a vehicle has an established reputation of being popular with consumers, or in today’s marketplace because of production shutdowns in the wake of the pandemic.” For more, click here.

Lithia Buys 4 Import Brand Stores in Texas

Lithia Motors Inc. has purchased four import brand John Eagle Dealerships in Dallas and Austin, Texas, that will bring in a combined $500 million in annual revenue as it continues to grow its dealership portfolio. Automotive News reports that the nation's third-largest new-vehicle retailer purchased John Eagle Honda of Dallas, Honda Cars of Rockwall, Howdy Honda in Austin, and Sport City Toyota in Dallas. The deal was completed over the weekend. Lithia, which owns domestic brand stores in Texas, did not disclose the purchase price for the dealerships but said it funded the acquisitions using free cash flows and "existing on-balance sheet capacity." Already this year, Lithia has purchased at least 10 dealerships that are expected to generate more than $1 billion in revenue. In July, the company announced the purchase of BMW of San Francisco and a Subaru dealership in Thousand Oaks, Calif., along with a Nissan dealership and a Chrysler-Dodge-Jeep-Ram store in Bend, Ore. For more on Lithia’s strategy, click here.

Consumers Shopping for a New Car are Still Wary, Adding to Problems for Automakers

U.S. new car sales have rebounded sharply since hitting recession lows when the coronavirus pandemic first struck, but July numbers could be signaling that another dip is in the offing, according to NBC News. “We’re in unprecedented and uncertain times right now — and consumers aren’t sure what to do,” said Stephanie Brinley, principal automotive analyst with IHS Automotive. Brinley pointed to a variety of factors, including job losses that are again on the rise, as well as the delay in renewing federal pandemic stimulus programs. But other factors are at work, according to industry experts, including a shortage of inventory at many dealerships, a result of the two-month shutdown of the North American automotive manufacturing network and similar closures abroad. While there should have been about 3.6 million vehicles on U.S. showroom lots last month, the figure was closer to 2.3 million, said Tyson Jominy, the head of J.D. Power’s PIN network, which tracks the market. The shortage is particularly severe when it comes to the big pickups and SUVs that helped prop up the U.S. market as the country first went into lockdown in mid-March. For other factors that may impact sales going forward, click here.

Honda Plunges into Red Amid Pandemic Pain

Honda Motor Co. tumbled to a $1 billion operating loss in the latest quarter amid slumping sales as the COVID-19 pandemic broadsided its key U.S. market. Automotive News reports that the Japanese automaker swung to an operating loss of $1.06 billion in the fiscal first quarter ended June 30, reversing an operating profit of $2.35 billion the year before. Citing the continued impact of the pandemic, Executive Vice President Seiji Kuraishi said operating profit was forecast to fall 68 percent to $1.86 billion in the current fiscal year ending March 31, 2021. North American sales plunged 68 percent to 159,000 vehicles in the quarter. Honda expects North American sales to finish the fiscal year 16 percent lower, dropping to 1.54 million vehicles. Honda’s dismal results come as the global auto industry reels from the impact of the pandemic and the resulting falloff in demand and regulations ordering factory closures. For more on Honda’s outlook, and that of its rivals, click here.

The 14 Best Japanese Cars in 2020

If you’re shopping for a car from a Japanese automaker, you’re probably well aware of how brands from the country continually rank highly when it comes to practicality and reliability. Even Japanese sports cars and sporty compact vehicles have earned high acclaim for being reliable and versatile – things vehicles in the respective segments aren’t exactly known for. In U.S. News & World Report’s ranking of vehicles from 2020, 14 vehicles ranked highly against their respective competitors. The majority of the vehicles on this list, like the Honda Accord, Toyota Camry, and Mazda6, are well-rounded cars that will appeal to all types of consumers. There's a reason for that, as new car rankings cover crash test scores, reliability ratings, interiors, and performance. Those factors are important to consumers shopping for a new vehicle. So, cars that tend to do well in all of the factors, instead of excelling in one area, rank higher than others. For the full list of best Japanese brand cars, click here.

Next Week's Webinars Feature Economic Update & How to Handle COVID-19 at Your Dealership

Don’t miss out on AIADA’s back-to-back AutoTalk webinars next week. Together, they’ll help you understand where our industry stands, and what you can do to handle COVID-19 at your own dealership.

  • Tuesday, August 11: An Update on COVID-19’s Impact on U.S. Auto Sales
    Join Cox Automotive Senior Economist Charlie Chesbrough for a review of our industry’s most recent economic data. 

  • Thursday, August 13: What If My Employee Tests Positive for COVID-19? 
    Learn critical steps you can take to protect your employees, steps to take if an employee contracts COVID-19, and how to return employees to work after they recover. 

Register for both sessions by clicking here.

 

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