What Dealers Can Take Away from the Cox Auto Weekly Summary

First Up 07/24/20

#DealersDoGood Friday

AIADA is focusing on how dealers are helping their communities during these challenging times by highlighting several of them each Friday in FirstUp. Here are a few recent examples of dealers who are doing their part to give back. 

  • Savannah Toyota recently partnered with Carey Hilliard’s Restaurants and League of Brawn to help feed area residents in need. The event was called “Southside Grocery Giveaway” and provided 283 bags filled with non-perishable food items. Click here for pictures. 

  • The Maine Honda Dealers donated $3,000 to six local schools to continue the fight against child hunger. Each dealership within the association selected a school to support with the special donation. Read more here. 

  • Larry H. Miller Dealerships is partnering with Denver7 and the Salvation Army in its Colorado markets for “Pack A Backpack” to collect school supplies for students. In the dealer group’s Arizona markets, it is hosting a “Driven to Assist” summer food drive with St. Mary’s Food Bank in Phoenix and Community Food Bank of Southern Arizona in Tucson. Read more here.

  • Eddie Tourelle’s Northpark Nissan’s team recently participated in a tour of the Northshore Food Bank’s operation in Covington, Louisiana, where Northpark Auto Group CEO Terri Turner-Marse presented a donation to support the food bank’s mission. During the COVID-19 emergency the food bank’s services have vital to more families than ever. Read more here. 

If you or a dealership is doing something great, let us know by clicking here, or join us on Twitter with the #DealersDoGood hashtag.

New Report Highlights International Auto Industry Contributions to the U.S. Economy

Autos Drive America, together with the American International Automobile Dealers Association (AIADA), released their annual economic impact report highlighting the significant contributions international automakers and dealers have on the U.S. economy. According to the report, in CY 2019, more than half of all U.S. new vehicle dealership jobs were created by international nameplate dealers, with a payroll of $34 billion. “International nameplate auto dealers are engines of economic growth in the United States, responsible for 56 percent of all new cars sold last year,” said Cody Lusk, AIADA’s President and CEO. “We are proud to share these numbers and increase awareness of the 564,000 Americans international nameplate dealerships employ and the $34 billion payroll they generate. As our country shifts into recovery mode, AIADA’s dealers will be leading the way toward better days ahead.” The report is designed to educate policy makers and the public that the U.S. auto industry is comprised of a global array of companies, each of which is deeply invested in growing and thriving in America. Read the latest economic impact report here. Listen to the latest Beltway Talk podcast to hear Autos Drive America President and CEO Jennifer Safavian discuss trade and the latest economic impact report by clicking here

What Dealers Can Take Away from the Cox Auto Weekly Summary

The coronavirus pandemic has certainly impacted the auto industry much more than most would have ever imagined. CBT Automotive Network reports that Cox Automotive’s Weekly Summary warns that the auto industry may regress in the coming months despite recent upticks in sales and jobs. Jonathan Smoke, the Chief Economist for Cox Automotive, noted that COVID-19 cases are rising rapidly throughout the United States, which is “leading to declining activity and consumer sentiment” while increasing unemployment and financial hardships. Smoke noted that “the jobs recovery seems to be slowing as well” and the economic recovery could “stall” as a result of the ongoing crisis. If things turn around for dealerships, higher demand for both new and used vehicles would reduce supply and likely raise prices as the economy recovers. Smoke’s update included that inflation spiked more than expected in the month of June and, according to a JD Power report from June 26th, the price of vehicles has also increased. Read more here. 

AutoNation to add At Least 20 Used-Only Stores

AutoNation Inc. plans to spend $200 million to $220 million to build 20 or more used-vehicle-only AutoNation USA stores over the next three years, following the launch of five stores in 2017 and 2018, reports Automotive News. The auto retail giant, which made the announcement with its second-quarter financial results Thursday that set a record for adjusted earnings per share from continuing operations, will provide more information on the AutoNation USA rollout during a third-quarter earnings call, CEO Mike Jackson said in an interview. Lower expenses, digital tools, higher new-vehicle gross profit per unit and a turnaround in new- and used-vehicle sales late in the second quarter from a dismal April at the beginning of the coronavirus pandemic helped the nation's largest new-vehicle retailer more than double net income to $279.8 million, from $100.8 million a year earlier. Revenue dipped 15 percent to $4.53 billion. Read more here. 

Car Sales Losing Momentum as COVID Cases Rise

Car sales appear to be losing momentum under the weight of continuing spread of COVID-19, which is sweeping through key automotive markets such as Texas and Florida, reports The Detroit Bureau. For the week ending July 19, retail sales were 9% below the pre-virus forecast, 6 percentage points worse than the prior week, according to a new weekly report from J.D. Power & Associates. J.D. Power reported that customer-facing transaction prices climbed $253 from last week to $35,396. “The week-over-week increase was primarily driven by higher premium nameplate share as well as prices edging higher in pickup segments. The result for the current week ending July 19 is 6.0% above the same week in 2019,” the firm noted. For the week ending July 19, premium retail sales were 2% above the pre-virus forecast, an 8-percentage point step back from the prior week. In the face of the stalling sales. Power reported that manufacturers and dealers held off on increasing incentives. Incentives increased by only $29 per unit. Read more here. 

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BMW X5 to Get Fuel Cell Version in 2022 [Automotive News Europe]

Cars That Depreciate the Most in 3 Years [Autoblog]