ALG Revises 2020 New Vehicle Sales Forecast Scenarios Based on Latest Impact of COVID-19

ALG to Provide Weekly Forecast Updates

SANTA MONICA, Calif., March 23, 2020 (GLOBE NEWSWIRE) -- ALG, a subsidiary of TrueCar, and the industry benchmark for determining the future resale value of a vehicle, is providing an updated 2020 new vehicle sales forecast to account for the quickly evolving Coronavirus (COVID-19) pandemic and the latest economic outlook. ALG will be revising its forecast weekly along with major new developments.

15.3M (Optimistic):

• • Movement restrictions lifted May 1
  • Stimulus packages deployed and having a positive impact

13.2M (Mixed):

• • Multiple social distancing periods limit out of home activity
  • Stimulus packages deployed and having a positive impact
  • Supply disruption due to production stoppages

11.2M (Cautious):

• • Ongoing social distancing and limited out of home activity through summer
  • Prolonged downturn, limited success of stimulus packages
  • Increased unemployment throughout 2020

“With the temporary closure of dealerships across the nation, continued declines in the stock market and ongoing uncertainty around the short/mid-term strategy to battle COVID-19, ALG expects further declines in our annual automotive sales forecast. While events continue to unfold daily, it seems the most likely outcome is vehicle sales landing in the mid 13 million range for 2020,” said Eric Lyman, Chief Industry Analyst for ALG.

“A dependable personal automobile will continue to play a critical role in daily life. Even during ‘stay at home’ orders vehicles will be used to get essential employees to work, deliver food, run critical errands and provide a safe transport in a time when public transportation is limited or unavailable,” continued Lyman.

“We cannot stress this enough, automotive sales will return,” said Morgan Hansen, Vice President, Data Science at ALG. “The aging U.S. vehicle fleet and growth of millennial market are underlying pillars of strength in mid to long-term auto sales. Natural replacement demand remains steady at roughly 15.5 million vehicles per year. Sales below this figure are not ‘lost,’ but merely deferred until we see a return to our daily routine.”

Added Lyman, “Online shopping and digital retailing will play a critical role in mitigating the drop in vehicle sales. Automakers are already rolling out innovative incentive products to stimulate consumer demand but the industry must iterate on existing sales practices and become more accommodating to shoppers in a ‘stay at home’ environment.”