AIADA's 2020 Chairman Jason Courter Discusses Industry Disruptors, Opportunities
There has been no shortage of auto industry news so far in 2020. From the Coronavirus to crude oil prices and everything in between, there is an air of uncertainty that has put the market on edge, reports the CBT Automotive Network. To discuss what this news means for dealers and auto retail professionals is Jason Courter, the new Chairman for the AIADA. Jason and Jim Fitzpatrick also discuss Colorado’s latest EV amendment, and what his goals are while in office. Watch Courter’s full interview here.
U.S. Auto Sales May Fall Off Due to Coronavirus
As the number of Americans identified as having the coronavirus rises, automotive analysts are predicting that new vehicle sales will fall, reports The Detroit Bureau. In fact, Morgan Stanley is predicting that sales will fall 9% compared with last year’s results. Prior to the outbreak, the U.S. industry was expected to fall about 2%, according to analyst predictions. Adam Jonas, Morgan Stanley auto analyst, wrote that “demand shock” triggered by the spread of the virus may cause a delay in large purchases, i.e. new vehicles, by consumers. As a result, he suggested that U.S. sales could drop to 15.5 million vehicles, from 17.1 million in 2019. Across the board, predictions for the U.S. in 2020 ranged from 17.1 million at the most optimistic end of the scale to as low as 16.6 million at the bottom end. However, LMC Automotive revised its forecast down to 16.5 million to account for the coronavirus. Automakers were largely unaffected by the coronavirus in February, but the longer-term impact could be substantial. Read more here.
Coronavirus Crushes China Car Sales
Auto sales in China collapsed in February, as the coronavirus epidemic shut factories and dealerships, and forced consumers to stay home, reports The Wall Street Journal. Sales fell 79.1% last month from the same period a year earlier, with just 310,000 vehicles sold nationally, the government-backed China Association of Automobile Manufacturers said Thursday. The decline was the Chinese industry’s worst monthly performance in modern times. “The auto consumption was stagnant and the demand was seriously suppressed, which will have a significant impact on the auto market in the first half of the year,” said Chen Shihua, the deputy secretary-general of the association. Xu Haidong, the deputy chief-engineer of the CAAM, said the association expects sales to pick up in March and for the market to return to normal levels by the third quarter. Analysts have, meanwhile, poured cold water on hopes of a rebound in the second half of 2020 compensating for the early-year slump. Shanghai-based consulting firm Automotive Foresight said it was being “optimistic” in forecasting a 3% to 5% decline in auto sales this year, having originally said sales would increase by up to 3% compared with 2019. Read more here.
IIHS: Automated Driving Tech Should Keep Drivers Actively Engaged
Automated driving technology such as Tesla's Autopilot and Cadillac's Super Cruise should be designed to have the driver actively engaged at all times, the Insurance Institute for Highway Safety said Thursday. According to Automotive News, IIHS, a nonprofit group funded by auto insurers, issued a set of safety recommendations for the design of such systems. The guidelines address ways to minimize driver disengagement and system misuse. Several Level 2 systems — the highest level currently available for vehicles in production — control acceleration, braking, and steering to keep the vehicle traveling at a set speed and centered in the lane, while maintaining a selected following distance from the vehicle ahead. The systems require the driver to remain attentive and ready to intervene, but IIHS said some designs make it too easy for the driver to disengage and heavily rely on the system. "Unfortunately, the more sophisticated and reliable automation becomes, the more difficult it is for drivers to stay focused on what the vehicle is doing," David Harkey, president of IIHS, said in a statement. "That's why systems should be designed to keep drivers actively engaged." Read more here.
Ford Plans Sweeping Dealer Closures in Europe to Accelerate Rebound
Ford's plan to shrink its European retail network to help the unit return to profit in the region will result in deep cuts to its dealers, particularly in the U.K., reports Automotive News. Ford of Europe President Stuart Rowley declined to say how many dealers will be slashed. “It will be appropriate for the market,” he told Automotive News Europe. Up to 180 of the 400 dealers in the U.K., Ford's biggest market in Europe, are at risk of closure, the Auto Retail Agenda newsletter reported last month. Cutting the number of dealers will improve profitability at Ford, Rowley said. “There is obviously a lot of cost wrapped up in the distribution network and that ends up in the price of the vehicle or coming out of profit,” he said. “We want to make the network more efficient.” He also believes the reduction will help Ford’s retailers. “Our dealers are private investors who expect a return on that capital,” Rowley said. Read more here.
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