When it comes to the economy, 2020 has been one wild and woolly ride, with the COVID-19 pandemic wreaking havoc around the world and causing widespread disruptions, delays, and distress. The automotive industry has seen its fair share of negative impacts stemming from the COVID-19 pandemic, and that includes General Motors. Now, however, GM is providing an economic and industry overview for Q3, providing some insight into exactly what went down over the last three months.
“While the economy has made a substantial rebound in the third quarter, retail auto sales have been even more resilient,” said General Motors Chief Economist Elaine Buckberg. “Super low auto loan interest rates have boosted retail auto sales; yet more strength comes from pandemic-induced demand.”
General Motors points to several key drivers with regard to “pandemic-induced auto demand.” These include consumer perception of private vehicles as a “safe space” for local and long-distance transportation, with GM citing surveys from McKinsey & Company and Ipsos.
General Motors also indicates that households which are “confident in their finances” are possibly using money saved on cancelled vacations, entertainment, and restaurant visits to save up for a new vehicle, while urban consumers have expressed greater interest in vehicle ownership as they move towards suburban living and weekend escapes.
What’s more, General Motors points to a rebound in housing permits as a good indicator for auto demand, while demand for RVs and boats underline a desire for heavy-duty pickup truck models.
Furthermore, General Motors says that dealers are reporting strong demand for large SUVs. These include the all-new 2021 Chevrolet Suburban, 2021 Chevrolet Tahoe, 2021 Cadillac Escalade, 2021 GMC Yukon, and 2021 GMC Yukon XL. Dealer deliveries for these overhauled full-sizers are ramping up this week.
As GM Authority reported just yesterday, U.S. GM sales dropped 10 percent in Q3 2020, down to 665,192 units. All four GM brands in the U.S. (Buick, Cadillac, Chevrolet, GMC) saw sales declines, as did the rest of the industry. Large pickups, however, showed strength with heavy-duty year-over-year growth, while sales improved sequentially each month within the quarter, including a significant rebound in September with a year-over-year sales increase. All-new crossover models also gained sales momentum.