It is not only new vehicle sales that will be hard hit by the economic impacts of the novel coronavirus, according to DesRosiers Automotive Consultants (DAC). There are various areas within auto retail that COVID-19 will reach as well.
Millions of Canadians are staying home due to government restrictions, business closures, and “social distancing”, and so the number of kilometres driven has declined significantly. The anticipated result will be a lower demand across the automotive sector as a whole.
What does this mean? We already know that new light vehicle sales declined (48%) in March and are expected to decline more significantly in April. But according to DAC, the scale of what is at stake for the auto industry is highlighted in its 2019 retail sales data.
Last year, Canadian auto retail sales topped $230 billion, and sales among new car dealers increased 2.3% to $132 billion. Most months throughout 2019 also revealed sales increases.
“This 2019 figure for new car dealers represents a record high. Growing even faster, retail sales at used car dealers increased 6.9%, rising to $12.34 billion dollars,” said DAC in its news release. “Retail sales at automotive parts, accessories, and tire stores increased in 2019 as well, rising 2.2% to $10.37 billion.”
The data offers a potential snapshot of what, and how far, COVID-19’s impact will be on the auto retail sector and the many areas it covers.
DAC plans to provide forecasts for the various sectors of the auto industry in the coming weeks, and Canadian auto dealer will be covering these updates regularly.
