Toyota U.S. August sales dropped 23% as coronavirus weighs on inventory

Toyota Motor on Tuesday reported a 23% decline in U.S. new vehicle sales in August against the same month in 2019, as a two-month industrywide shutdown of auto production in the spring to stop the spread of COVID-19, along with uncertain economic recovery, weighed on sales.

This was Toyota’s fifth straight month of U.S. sales decrease.

South Korean automaker Hyundai Motor said its U.S. sales dropped 8.4% in August, mostly because of a decline in fleet sales to rental car companies, government agencies, and corporations. Hyundai had posted a slight sales gain in July.

Automakers are having a hard time to get inventory to dealers to replenish stocks after the coronavirus led lockdowns.

This has allowed them to scale back consumer discounts on popular models and increase vehicle prices.

According to consultancies LMC and J.D. Power, which had predicted industrywide U.S. new vehicle sales to drop 20% in August, almost 45% of vehicles sold during the month spent fewer than 20 days on dealer lots, 35 percentage points more than 2019.

TrueCar Inc subsidiary ALG said on Tuesday that the average transaction price for vehicles increased 3.9% in August against the same month in 2019.

While U.S. demand for new automobiles has remained stronger than expected after driving off a cliff in March and April as a number of states shut down due to the coronavirus, there is plenty of uncertainty over whether a sustained recovery is possible.

Outbreaks of COVID-19 throughout southern and southwestern U.S. states during the summer appear to have slowed the economic recovery. Unemployment remains high and could weigh more on sales moving forward.