Demand for vehicles evaporates

General Motors Co. and Fiat Chrysler Automobiles NV gave an early glimpse of the damage a global pandemic has done to their U.S. sales, reporting deliveries that fell short of analysts’ estimates.

Sales fell 7.1 per cent for GM and more than 10 per cent for Fiat Chrysler in the first three months of the year, both bigger declines than expected. While neither company provided a breakdown by month, demand by all accounts collapsed midway through March. Brands including Volkswagen, Honda, Hyundai and Mazda reported drops of more than 40 per cent for the month.

The coronavirus pandemic has devastated an industry that just a few weeks ago looked poised to benefit from another year of healthy consumer confidence, cheap financing and a strong labour market in the U.S. Analysts are now all over the map in issuing estimates for how low sales will go, with virtually no one expecting a speedy recovery. China is recovering slowly from its bout with the virus, while Europe is preparing for the worst.

GM shares fell 7.3 per cent and Fiat Chrysler slumped 5.2 per cent Wednesday in New York. Ford Motor Co. fell 8.9 per cent.

Toyota Motor Corp.’s U.S. sales sank 37 per cent in March as many of its showrooms were shuttered. The downdraft spared no models, with deliveries of its best-selling RAV4 SUV dropping 25 per cent last month.

Nissan Motor Co., whose sales woes predate the spread of the virus, had the weakest first-quarter showing among major manufacturers, posting a 30-per-cent plunge in deliveries.

“We obviously saw quite a big tail-off in business,” David Kershaw, division vice-president of the Nissan brand in North America, said by phone. “We’re feeling it in arguably one of our best regions, which is the northeast. They are obviously significantly impacted.”

Honda Motor Co. rounded out the three largest Japanese automakers with a 48-per-cent plunge in March. Sales of its namesake and Acura brands dropped 19 per cent for the quarter.

In addition to trouble on the retail front, rental-car companies are paring back vehicle purchases as they seek to be included in the U.S. federal government’s rescue of travel-related companies including airlines.