With a lot of optimism and vaccine hopes, U.S. auto sales could increase as much as 10% in 2021
- Automotive executives and analysts are cautiously optimistic that U.S. vehicle sales will return to some form of normalcy in 2021.
- Early forecasts for new vehicle sales this year range from about 15.5 million to 16 million vehicles, which would be an increase of between 7.6% and 10.3% compared with 2020.
- Last year's sales were down 14.8% to 14.5 million vehicles, according to Cox Automotive.
U.S. automakers are suffering from the deepest sales decline in decades, the country is still politically divided and it's in the middle of a pandemic.
But if officials can quickly roll out a Covid-19 vaccine and stabilize the nation, automotive executives and analysts have reason to hope U.S. vehicle sales will return to some form of normalcy in 2021.
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"I am as optimistic as one could be because I think the core environment is there, but, of course, what is weighing on everything is how quickly can we get the shots rolled out and things stabilized," Volkswagen Group of America CEO Scott Keogh told reporters during a recent media call.
Industry executives and analysts predict strong consumer demand will continue this year and expect a return of commercial fleet sales as local officials distribute the Covid-19 vaccine.
Early forecasts for new vehicle sales this year range from about 15.6 million to 16 million vehicles, which would be an increase of between 7.6% and 10.3% compared with 2020. Last year's sales were down 14.8% to 14.5 million vehicles, according to Cox Automotive.
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"While the coronavirus was something that no one in the auto industry expected, the industry rallied and adapted to the new state of play," Patrick Manzi, chief economist at the National Automobile Dealers Association, said in a statement. "Looking forward, we are optimistic about the continued recovery of the new light-vehicle market."
Jessica Caldwell, executive director of insights at auto research firm Edmunds, believes the current political climate won't have a lasting impact on auto sales for the year.
"You may have a bit of slower sales during this period as tension is kind of high and peoples' focuses are elsewhere. It was similar leading up to the election," she said, adding January is historically the worst sales month of the year. "If there is an effect, it's not going to be a big one."
Toyota Motor and IHS Markit have the most optimistic sales forecasts so far at 16 million vehicles in 2021. Auto research firms Cox Automotive and LMC Automotive expect 15.7 million vehicles to be sold in 2021.
"It's a decent improvement, a continuation of the recovery," said Jeff Schuster, LMC Automotive president of the Americas. "There's still a lot of uncertainty that's maybe clouding the industry a little bit. ... The vaccine, new strains, all of that plays a role in just how much recovery takes place."
Other companies, including General Motors, are expected to release sales forecasts for 2021 in the coming weeks.