Slight Recovery for Auto Sales in JuneBy Alejandro Enríquez | Thu, 07/02/2020 - 14:02
The first half of 2020 has gone by, with 2Q20 marked by in an unprecedented period of social distancing and economic downturn. Auto sales did not escape unscathed. April reported historic sales lows with just 34, 903 units sold. The figure increased to 42,028 units sold in May. With 62,837 units sold in June, the market experienced a 49.5 percent increase compared to May.
"Restrictions on economic activity by governments to limit the spread of the virus locally, as well as the weakening global economic growth, will result in an adverse external environment for the region’s economies, thereby debilitating business and consumer confidence," wrote Guillermo Prieto, President of Latin American Association of Automotive Distributors (ALADDA) in an article for Mexico Business News.
You can read Guillermo Prieto's expert opinion here.
Accumulated 1H20 sales figures saw a 31.9 percent reduction compared to the same period in 2019. Accumulated sales this year are similar in absolute numbers to those seen in 2011 or 2012. However, June 2020 records the lowest June for sales since 2010, when just 59,910 units were sold.
The New Normal began in Mexico in June. Based on a color code going from red to green, cities and states will be allowed to resume certain economic activities. When in red, just essential industries are allowed to operate at a lower capacity. Car dealerships are not considered part of an essential industry. However, the pandemic has accelerated vehicle online sales to reach 15 percent of brand's sales between April and May according to El Financiero. This sales channel doubled its market share when compared to 2019.
You can read our full article on online vehicle sales here.
Breaking down sales per brand, almost all brands presented positive results compared to May, with an average growth of 65.3 percent. Only Mercedes presented a 14.6 monthly decrease. Numbers above 100 percent growth were reported by Acura, Isuzu, Porsche, Volvo, Audi and BAIC.
As for annual variations, almost all brands showed weaker numbers, with an average negative growth of 37.1 percent. Only Porsche presented a positive annual monthly variation of 6.7 percent. The steepest falls were experienced by INFINITI, BAIC and Isuzu.
As the market starts to see signs of recovery from historic lows seen in April and May, dealerships remain uncertain about the extended economic consequences of the pandemic. "While the extent of the outbreak varies by country, it is expected that all vehicle markets in the region will be negatively impacted by this historic pandemic," says Prieto.