Automakers are looking at some good news in the near future when it comes to determining how the coronavirus pandemic impacted the industry as a new study shows that buyers are simply putting off new vehicle purchases, not cancelling them all together.
According to the CarGurus latest COVID-19 Sentiment Study, sales have only been delayed, which means big numbers for car companies once things get a little closer to normal. The study is the third of the year, following April and June versions, aimed at getting a clear picture of how the crisis is affecting not only the industry but consumers as well.
“When compared to our previous research, the latest CarGurus COVID-19 Sentiment Study paints a consistent picture that points to a silver lining for the auto industry amid the pandemic,” said Madison Gross, director of Consumer Insights at CarGurus.
(Autolook for auto industry looks promising in 2021.)
“Over the course of the year, we have seen car shoppers delay but not cancel their purchases, a shift from public transit and ride-hailing towards vehicle ownership and an increase in openness around buying a car online. When coupled with the automotive industry’s current high demand and low supply, it is likely for these trends to continue into next year.”
In addition to providing some hope for automakers about what the future holds – increased sales – is also confirmed some of what many observers already knew, such as it was harder to find the exact vehicle you wanted this summer because production was down for about two months. Buyers in March through June prices found prices were lower than those in July through November. Additionally, there was better selection earlier in the year than in the summer and early fall.
Also, buyers are really getting comfortable with online car shopping. Before the pandemic, 35% of respondents said they were open to buying a vehicle online and that has increased to 60% as of the most recent November research. This openness to buying online has not wavered since June (60%) or April (61%) – despite dealerships reopening across the country.
(Trade-in values on used car prices falling back to normal.)
However, when it comes to going the last mile, that face-to-face meeting still appears to be most people’s preference. Only 41% would prefer to buy a vehicle online. In particular, shoppers are more likely to prefer online price negotiation (61%) and online financing (52%), the study found.
For a long time, there was a big push on to use public transit and engage in ride sharing to help lower the impact of automobiles on the environment, save gas, ease traffic, etc. However, the easy communication of the coronavirus has people rethinking their desires to use public transport and such.
As of November, 34% of previous rideshare users and 45% of public transportation users expect to decrease or stop their use of these services. This has remained fairly consistent over the course of the pandemic (39% in June, 39% in April for ride sharing; 45% in June and 44% April for public transportation).
(Worsening pandemic hammers auto industry as GM cuts ops at Texas plant.)
Vehicles offered people an entertaining diversion during the pandemic with 47% using their car more for road trips or longer drives, and 43% agreeing that they see their cars as a source of escape or fun during this time.
