Auto sales are unquestionably ugly — and probably will be for a while — but they appear to be getting better, not worse.
J.D. Power believes the recovery already has started.
The company said retail sales, compared with its forecast from before the coronavirus pandemic, showed signs of stability in the first half of April. Retail sales were 55 percent below expectations for the week ending April 5 and rose slightly in each of the following two weeks.
Retail sales grew during the week ending April 19 in 24 of the country's top 25 markets, though demand was still down significantly year over year, J.D. Power said. The exception was Denver, where sales were flat.
Thomas King, president of J.D. Power's data and analytics division, said the industry still faces a difficult environment but that the regional data shows sales are gradually getting back to a "more normal" pace. Stay-at-home orders in many cities and states have not affected auto sales as severely as expected, King said.
"We didn't see the change in behaviors that we saw in places like [San Francisco] apply in places like Texas and Phoenix. Now we're seeing the recovery," King told Automotive News.
"We have likely experienced the worst of the decline," he said, though the current level of decline is still "extremely damaging to the industry."
After Pennsylvania's governor lifted restrictions last week, all 50 states offer vehicle sales in some fashion, although 26 limit dealerships to online or remote sales. The federal government also recently updated guidance that many states are relying on to classify auto sales as an essential service.
"Many consumers still may not even be aware that you can complete this transaction from your house," said Tyson Jominy, J.D. Power's vice president of data and analytics. "Consumers have been so trained in how cars are purchased in this country that unless you saw that email, or got a phone call or text from your dealer, you may not even know that they can do this for you."