10 Takeaways from U.S. Auto Sales: Q1 2020 and COVID-19

To many we’ve spoken with, March may have been the longest month ever. Or it just seemed that way as our lives, the economy, and the auto industry began a slow-motion crash into the ditch that dragged on forever. Cox Automotive is all too aware of the impact COVID-19 is having on every corner of the auto business. Our team of analysts has been sharing data and insights with our many clients and partners, providing an important perspective on the market. We’ve also moved forward with numerous initiatives to help our clients work through this difficult period. (Read about those initiatives here.)

When the March crash finally ended and Q1 sales were announced, the numbers were down steeply, as expected. The forecast for April is even worse, as more states adopt stay-at-home policies to slow the spread of COVID-19. What did we see in the numbers from last month and last quarter? Here are ten quick takeaways from the Kelley Blue Book team.

1. New vehicle sales totaled 3,503,466 units in Q1 in the U.S., a decline of more than 12% from last year. It was the final 20 days of March that went all wrong. The seasonally adjusted annual rate of sales in January and February averaged 16.8 million. In March, it fell to 11.4 million.
2. Few brands made it out of Q1 2020 with increases. Very few. Lincoln, Ram and Tesla sold more vehicles in Q1 2020 than they did in the first quarter of last year, and Kia eked out a small increase – about 1,000 vehicles more. They were the fortunate ones. The other 30 brands our Kelley Blue Book team tracks showed declines, some more than others: Mini posted sales in Q1 off more than 40% versus 2019. Fiat dropped by nearly 50%. They will be the brands to watch this year.
3. The industry in March was upside down in many ways. The full-size pickup truck segment was the #1, best-selling segment in March. It’s typically 3^rd or 4^th best in any given month, and well behind midsize and compact SUVs.
4. One thing that didn’t change: New vehicle buying continues to be an expensive adventure. The average manufacturer’s suggested retail price (MSRP) of a new vehicle in March, according to Kelley Blue Book, was near $41,000. And a full-bore recession won’t likely change that.
5. Were there bright spots in Q1? Yes. Chevrolet sold a lot more Bolts in Q1 this year than last year, and Toyota’s RAV4 sales were up 16%. The GM full-size pickups also hit their stride last quarter, with the Chevy Silverado up 26% – and easily outpacing the full-size RAM pickup to reclaim the #2 spot in the pickup race.
6. Looking at March sales numbers, there’s an industry truth that continues to hold: There are a lot of vehicles in the U.S. that just don’t sell very well. In all, 291 different models registered at least one sale in the U.S. last month. The top 30 best-sellers accounted for 54% of total volume. The bottom 200 tallied well below 3,000 units each and accounted for only 17% of total March volume.
7. The Ford Ranger delivered a solid first quarter, nearly outselling the Chevy Colorado – 20,980 versus 21,430. But in the midsize pickup segment, it’s all a race for second place. The Toyota Tacoma continues to be king, with sales north of 50,000 and a 40% market share.
8. If there’s precision clockwork in our industry, it’s the F-Series pickup from Ford Motor Company, the best-selling vehicle in the U.S. since the Carter Administration. In Q1 2019, Ford sold 214,611 F-Series pickups, which accounted for 38.18% of total Ford brand sales. In Q1 2020, Ford sold 186,582 F-Series pickups: 38.14% of total Ford brand sales. Like clockwork.
9. The rich are not like us. They buy super high-performance vehicles like the Mercedes-Benz AMG GT or Ford GT. And apparently for the rich, March was hardly a worry. As the economy spun and tumbled, the high-performance car segment was bullet proof – down only about 2% from 2019.
10. The most affordable car in U.S. last month was the Chevy Spark, with an average transaction price of $15,111, according to Kelley Blue Book. Approximately 1,800 Sparks were sold in March, far more than the Audi R8, the most expensive model in the Kelley Blue Book data set. Average transaction price: $198,687. March, however, was the R8’s best month of the year. It was the worst month for the Spark.

As we head into Q2 2020, all bets are off. With production shutdowns, state-wide stay-at-home measures and the general economic chaos caused by COVID-19, there’s no telling how the next few months will unfold. The Cox Automotive team is forecasting total sales in 2020 to be under 12 million, a 29% drop from 2019. Unfortunately, at this point, the only thing we can do is buckle up tight and be ready for the recovery when it comes.