On March 27, auto analyst Adam Jonas at Morgan Stanley predicted a springtime apocalypse for the auto industry. “There are basically no U.S. auto sales right now,” he told investors. The bank was mulling modeling scenarios that shut down the industry for six months or more.
Analysts were predicting a huge glut of unsold cars on dealers’ lots for the foreseeable future. “Six months from now, there will be huge, if not unprecedented, levels of wholesale supply in the market,” wrote Dale Pollak, an executive vice president of Cox Automotive, to auto dealers in early April. “Cars are coming in, but they aren’t selling.”
What a difference a month makes. With factories shut down amid-stay at home orders, inventory is thinning. The pandemic’s economic carnage hasn’t spared the auto industry, but it has not struck all vehicles equally. Compact and mid-sized cars as well as trucks and SUVS have seen a massive drop in demand. But trucks and SUVs still remain significantly more popular.