How Lockdowns Hit U.S. New & Used Vehicle Sales: Beyond Ugly | Wolf Street
Lockdowns are still being rolled out in the US. Many auto assembly plants have been shut down – for a slew of reasons, including initially the difficulty to get components, then the health risks, and now the collapse in demand.
The stocks of automakers already got hammered.
Ford [F], which has been going through costly restructuring programs for years to cut expenses, and which recently eliminated its dividend, is down about 50% from a year ago, and down 72% from 2014, to $4.71 a share.
GM [GM], which will likely eliminate its dividend soon, is down 45% from a year ago to $21.30. Shares of Fiat Chrysler Automobiles [FCA] have plunged 51% from a year ago, and 70% from the peak in January 2018, to $7.62. Tesla [TSLA], at $545, remains in la-la-land, though also down 44% from the WTF peak.
The industry – the thousands of new and used vehicle dealers, the automakers, and the component makers – cannot survive for long on the basis of this type of sales collapse, no matter what the bailouts are. This is a healthcare crisis that keeps people at home, and most people are clearly not interested in exposing themselves to Covid-19 to buy a car.
A major local car dealer registered ZERO sales so far this month..