Trucks come off the assembly line at GM’s Chevrolet Silverado and GMC Sierra pickup truck plant in Fort Wayne, Indiana, July 25, 2018.
John Gress | Reuters
The coronavirus pandemic is changing life as we know it. But one thing the crisis hasn’t changed is America’s love of pickup trucks.
Boosted by 0% financing for up to 84 months, J.D. Power reports U.S. sales of pickups are exceeding all passenger cars. Truck sales beginning this month were only off 1% compared with pre-pandemic forecasts, according to the firm.
“It continues to do and is doing rather spectacularly,” Tyson Jominy, J.D. Power vice president of data and analytics, said Wednesday. “For all intents and purposes, pickup trucks are running almost exactly where we would expect them to be on a volume basis.”
During the coronavirus pandemic, pickup retail sales have significantly outpaced the industry. Pickup sales were only down by 9.4% during March and April compared with the same time frame last year, while car sales fell by 51.2%, according to J.D. Power. Overall retail sales across the industry dropped 41% in March and April from the same months last year, J.D. Power said.
Retail sales were expected to slow this year before the pandemic, but the outbreak caused demand to plunge even more. Retail sales do not include sales to fleet customers such as the government or businesses.
The continued demand for large pickups could soon turn into a problem, specifically for General Motors, Ford Motor and Fiat Chrysler, which dominate the segment. J.D. Power says inventory levels are nearly half of what they would typically be due to the coronavirus, which has forced shutdowns of U.S. plants since March.
“We’re continuing to see strength in trucks and, therefore, lower levels of inventory,” GM CFO Dhivya Suryadevara told analysts during a first-quarter earnings call last week.
GM, she said, is keeping a “close eye on dealer inventory,” specifically in markets that weren’t as impacted by the coronavirus. She said producing pickups and SUVs will be top priority when production is scheduled to resume on May 18.
Mike Manley, CEO of Fiat Chrysler, shared similar thoughts with investors Tuesday: “I’m pretty sure you’re going to see another relatively strong month with trucks, being there are certainly configurations that we’ll be running short.”
Manley said he “can’t remember when” the company has had such low inventory.
Fiat Chrysler and Ford also plan to restart production at their plants on May 18.
Pickups are especially critical to Ford’s profitability. Its F-Series, including the F-150, has been America’s best-selling vehicle for 38 consecutive years and the country’s top-selling truck for 43 years.
Ford, according to executives, is continuing with plans for a redesigned version of its F-150 pickup later this year.