With automobile showrooms closing due to the coronavirus pandemic, Fiat Chrysler Automobiles on Wednesday reported a 10% decline in U.S. quarterly sales and moved to increase demand with bigger discount and a program allowing consumers to buy vehicles entirely online.
The company’s move toward online sales and home delivery breaks with a long American auto sector tradition of manufacturers giving franchised dealers control of sales to costumers. Dealers have fought Tesla Inc’s attempts to sell vehicles directly to costumers through its website.
But the pandemic has been pulling auto retailing into the digital age, with dealerships closed across the nation and sales likely to take a further beating in April as social distancing guidelines continue to be in place.
FCA shares dropped 4.2% to $6.80 in early trade following the company’s report that it experienced a 10% drop in first-quarter U.S. auto sales, as the coronavirus hurt demand and stopped production from mid-March, although the company did not mentioned sales by month.
Hyundai Motor stated earlier that its U.S. sales dropped 43 percent in March because of the pandemic. Other automakers also were expected to report lesser sales.
“It goes without saying that the entire world is dealing with a tremendous challenge that is having a significant impact on business and our normal way of life,” said Randy Parker, vice president for sales at Hyundai Motor America.
FCA stated its “Drive Forward program” permits customers to finish the entire vehicle purchase process online and from the comfort of their own homes.
The system allows costumers to purchase vehicles off dealer lots, trade in their old vehicle and apply for a car loan, FCA stated.
The company also said that as of April 1 consumers can take advantage of zero percent interest loans for 84 months and make zero payments for 90 days on select 2019 and 2020 model vehicles.
FCA stated it sold 446,768 vehicles in the first three months of this year, compared with 498,425 units a year earlier.
Fiat said momentum in the first two months of the year was offset as the virus impacted the economy in March. Its Ram pickup trucks were a bright spot as their sales increased 7% in comparison to the first quarter of 2019.
Credit ratings agency Moody’s Investor Service expects global auto sales to drop 14% in this year, with light vehicle sales in the United States dropping at least 15% in the same period.
About 235,747 people in the US have been confirmed as being infected with the coronavirus. The virus has killed 5,624 people in the country.
