By NEIL HARTNELL
Tribune Business Editor
New car sales plunged more than 90 percent during the COVID-19 lockdown’s peak, data seen by Tribune Business has revealed, with many dealerships “not selling a single vehicle” for April.
Bahamas Motor Dealers Association (BMDA) statistics disclosed that new vehicle sales for that month declined by 90.6 percent compared to February 2020, the last full month of activity before the government’s emergency powers took effect in mid-March and forced the sector into a near-total shutdown.
BMDA members collectively sold just 12 autos in April, compared to 123 and 127 sales for January and February, respectively, highlighting the unprecedented economic blow suffered by the auto industry which was likely mirrored in other sectors also forced to close their doors.
New vehicle sales dropped to 96 in March, down almost one-third month-on-month, as the COVID-19 lockdown took hold in the month’s final two weeks. May numbers, according to BMDA data, recovered slightly to 67 - down 47.3 percent on February 2020 - as dealers began to emerge with curb-side and delivery services.
Figures for 2020’s first five months show total new vehicle sales down by more than 200 year-over-year, or 32.32 percent, illustrating the extent of the hit suffered by a sector where such transactions are its main revenue driver and profit earner.
“If you’re down 30 percent on sales on the most important part of your business it’s a pretty significant impact,” Rick Lowe, the BMDA’s secretary, told Tribune Business. “We’ve got similar corresponding drops in service and parts for those months. Many of us didn’t sell anything in April.
“Basically we’ve lost a quarter pretty much. We lost half of March, April and May. Those of us that didn’t lay-off people, it impacted cash flow significantly so we have to get this economy going. It’s the whole gamut of the business. Parts was OK, but not anywhere near normal because of social distancing and curb side.”
Mr Lowe added that much now depended on the timing and strength of the tourism rebound when The Bahamas re-opens its borders to commercial flights and international travel on July 1.The sector, the country’s largest employer and foreign exchange earner, is the critical driver of economic activity that supports new auto sales and other domestic activity.
“So far it’s fairly slow,” he added of the industry’s full re-opening. “We have to get through June, and if we re-open this country to international travel on July 1 still, we will see what kind of flows we have and go from there.
“Our economy is dependent on foreign direct investment and tourism. There’s not enough local investment to sustain everything that needs to be sustained. Right now there’s just so much up in the air. We’re grateful to be half-way back to normal, but it’s disconcerting.”
Ben Albury, Bahamas Bus and Truck’s general manager, told Tribune Business that the next fortnight will largely determine whether pent-up demand and interest in new vehicles actually translates into completed sales. He conceded that the BMDA figures were “drastically down because we lost a few months of business”.
“Right now there’s a lot of prospects, and we’ve had a lot of activity,” he added. “It hasn’t necessarily translated into the actual sales I would have liked to have seen at this point, but I understand what I’m up against as far as credit is concerned and joblessness being so high.
“The amount of inquiries I’ve had in such a short period of time is encouraging, but it takes time from the point of contact to provide an invoice, and then they have to get the documents from the bank and the credit union. The sales I’m getting today are the sales I’ve been working on for a couple of weeks, and the clients have been working on for a couple of weeks. You gave to plant the seeds and watch them grow.
“In the next week or two I’ll be better able to gauge where we are. It’s too soon to tell exactly where the chips are going to fall. What will make the difference is how quickly things will rebound, and people get back to normality. I’ve got a lot of people e-mailing me and contacting us for quotes,” Mr Albury added.
“I’m very optimistic that in a short period of time we will feel that recovery, but how quickly that happens it’s hard to say, and to what extent. I’ve also seen a big uptick in interest in commercial vehicles with businesses going to delivery, and in construction vehicles.”
Mr Albury added that the lockdown had impacted dealers differently depending on the vehicle brands and makes they carried, with sales down by varying percentages across the industry. Bahamas Bus and Truck sold 30 units prior to the March closure, and he added: “When you have zero business, that is a major impact coming off a year that was showing strong recovery.
“I’m just hoping the banks are able to lend money and people have jobs. It seems to me that the banks are being aggressive in trying to get loans out, and getting people in vehicles. It’s going to take a group effort to push this.”
Mr Albury also urged Bahamian auto buyers to focus on purchases at home, rather than heading to Florida or using the Internet to source used vehicles from Japan, on the basis that the country needs to keep every dollar possible circulating in the local economy.
“I think Bahamians need to start to realise that for the greater good of everybody that more of this money needs to stay in the country rather than rushing off to be spent in other places. In most cases there’s no advantage to buying abroad,” he argued.