Recovery from the impacts of Covid-19 on auto sales in Canada likely won’t come until 2021, according to a new report from DesRosiers Automotive Consultants.
In the first of what is anticipated to be a series of updates, DesRosiers examined a number of factors, including production and sales data in China and Italy, to develop possible models for Canadian new-vehicle sales.
“From this modelling our current “baseline” scenario shows a decline for new vehicle sales of approximately 25-30% for 2020. The “less severe” scenario shows a decline of approximately 10-15% while the “more severe” scenario sees a precipitous fall in excess of 60% for the year,” the report states.
Acknowledging that this is “uncharted territory for all of us,” the company is mainly interested in three big questions:
* How long the virus / economic closures last?
* How deep will the economic downturn be during those months?
* What will the recovery curve look like?
“Clearly there are no easy answers to any of these questions,” the report states, but it stressed that pent-up demand will eventually have to be satiated. Other economic priorities are likely to rank above automotive in consumers’ minds in Q3 and Q4 2020.
“We would also highlight that our outlook for other sectors of the auto market – especially the aftermarket and the used vehicle market – is different from new vehicles sales. We will discuss those further in future updates.”