US auto market shows signs of recovery in May
Peter Campbell in London
The US car market showed the first signs of recovery last month after dropping to a record low during April, according to sales figures from a handful of brands.
Toyota reported that sales doubled in May compared with April’s levels, though remain 26 per cent lower than a year earlier.
Hyundai posted a drop of 13 per cent compared with a year ago, but also saw sales double compared to April.
The results are in line with expectations for the whole industry to be down by around a third on the previous May, though around double the levels seen in April, when significantly more dealerships and factories were closed because of the pandemic.
Toyota said it forecast the industry’s expected 12-month sales average based on May’s data — a term known as the seasonally adjusted annual rate, or SAAR — to be 12m, a significant pickup compared with April’s SAAR of 8.6m.
While retail sales — cars sold to customers — recovered during May, the industry’s fleet sales, which include hire car groups such as Hertz and Avis and typically account for around half of all sales, remained much lower. Hyundai saw fleet sales fall by 80 per cent, while retail rose by 5 per cent compared with a year earlier, the group said on Tuesday. Many of the large car brands, including Ford and General Motors, no longer produce monthly sales figures.
Analysts at IHS Markit expect total 2020 US car sales to be 12.7m cars, far below 2019’s level of 17m but not as low as the 10.4m they fell to in the wake of the financial crisis in 2009.
Stephanie Brinley, lead analyst at IHS Markit said:
Overall, May performance suggests that consumers do still want to buy vehicles and basic demand remains.
Light-vehicle sales are estimated to have recovered to more than 1m units in May, after April 2020 sank to only about 710,000 units.
In the second half of the year, however, impact from the economic downturn can continue to undermine that demand.