Ford Motor’s U.S. sales chief stated on Thursday the automaker believes some level of government encouragement will be needed for consumers once the coronavirus pandemic is diminished and that the crisis will spur a permanent shift toward more online vehicle sales in the country.
“It’s hard to figure out how long and what the lingering effects of this will be,” Mark LaNeve informed Reuters after the company reported lower quarterly sales because of the pandemic. “But certainly we believe that some level of government stimulus post crisis to help consumers and the auto industry to recover would be appropriate.”
The No. 2 U.S. automaker published a 12.5% decline in U.S. auto sales for the first quarter.
Government orders for businesses to shutter and consumers to remain at home in the face of the pandemic stalled demand throughout the auto industry.
Economists state the stay-at-home measures have pushed the economy into recession. The number of Americans filing claims for unemployment benefits last week were at a record high of 6.65 million.
During the Great Recession, the American government rolled out a “cash-for-clunkers” program, which offered consumers rebates of up to $4,500 to trade in older gas guzzlers.
Ford at the moment is considering “thinking over ideas” for government stimulus for consumers that it will discuss with its government affairs team, LaNeve stated.
He said about 93% of Ford’s 3,100 U.S. dealers are doing some or all aspects of sales online, from virtual tours to financing and home delivery, as the pandemic has closed showrooms in a increasing number of states.
“Good dealers have been doing remote delivery for the last 20 years, but it was maybe one a week,” he stated. “Now they’re doing almost every delivery that way.”
Ford is beefing up its present online tools to support virtual sales through its dealers, and LaNeve stated the coronavirus crisis will push more sales to the internet in the long term.
“This has just turbo charged the adoption of those processes by both customers and the dealers,” LaNeve stated. “To be honest, I think a big chunk of that stays with us even when we’re through the crisis.”
Ford’s passenger car sales dropped 36%, while sports utility vehicle sales declined 11% in the first quarter.
The automaker did not provide monthly sales figures, but estimated that industrywide U.S. new-vehicle sales dropped 39% in March. LaNeve stated Ford’s sales decline was lower than that.
About 277,985 people in the US have been confirmed as being infected with the coronavirus. The virus has killed 7,146 people in the country.