I acknowledge that I may be the wrong person to comment on this (having not owned a car for several years since moving inner-metro as an ‘empty-nester’) but I can’t imagine what would cause anyone to go out and buy a new car during the midst of a global pandemic. However, in both China and the US, the auto industry is reporting better than expected car sales so far in 2020, which is creating cautious optimism about future consumer demand and retail spending.
In China, according to Reuters “auto sales in July climbed 16.4% from a year earlier, the fourth consecutive month of gains” and “in a promising sign for many global automakers which have invested heavily in electric vehicles for the China market, sales of new energy vehicles ended 12 straight months of decline with a 19.3% jump to 98,000 units”.
And in America, according to Autowise “demand for new cars in America has seen an incredible revival since the early days of the pandemic” due to “a marketplace ‘sugar rush’. That is, a surge in demand from drivers who’d been planning to buy a new vehicle right when COVID-19 hit and then had to postpone that purchase due to lockdowns or fear of visiting dealerships. When conditions eased up, many of these consumers rushed to make their delayed purchase”.
I suppose a combination of very low interest rates, surging stock markets and rising house prices have all had an impact, not to mention the extra time spent at home driving the kids around (in the US) and avoiding crowded trains and buses (in China). Spending more time than usual in your old car is perhaps a trigger to remind you that it’s time to buy a new one.
Car sales have been an important indicator of consumer confidence in China in recent times, which will be a critical driver of future economic growth, so it’s worth keeping an eye on these numbers to see whether the upward trend continues.