CBT automotive newscast: June 24, 2021

Featured Interview:

Jonathan Smoke, Chief Economist at Cox Automotive breaks down the latest Dealer Sentiment Index
Recently, Cox Automotive published its quarterly Cox Automotive Dealer Sentiment Index for Q2. The index measures dealer sales expectations and how they perceive current auto retail trends over the next 90 days. Joining us to discuss the findings of this latest index, is Jonathan Smoke, Chief Economist for Cox Automotive. Watch the complete segment here.

Top Headlines:

To keep their commercial business moving forward, Ford Motor Company will provide engines and transmissions for new U.S. Postal Service delivery vehicles. Vehicle production will take place in South Carolina and will be assembled by Oshkosh Defense. The company plans to begin production in summer 2023.

After Carvana’s latest dip in stock value, JP Morgan’s Rajat Gupta downgraded the company. Now, many are left wondering if they should buy or sell their stock. Although Carvana rose to become one of the biggest sellers in the auto industry, its stock has reached a near-term top and investors believe they may find value elsewhere.

In other news, the uptick in new vehicles has largely been driven by trucks, crossovers and, electric vehicles. EV sales have nearly doubled in the U.S., causing a 95% increase for new vehicle registrations for electric vehicles. The jump contributed to the market share increasing from 1.6% to 2.3% year-over-year. California leading the way for EV buyers, as well as southern states like Florida and Texas.

Lithia Motors is also making moves in the southern market with its latest purchase of a Toyota dealership in Jackson, Mississippi. Additionally, the company sold its Audi store in California. With this new acquisition of Herrin-Gear Toyota, Lithia is adding a projected $95 million to the dealer group’s annual revenue, totaling an expected $7.6 billion in annual profits.

News & Opinion:

Auto Market Summary points to slight market correction
Cox Automotive released its latest auto market weekly summary Monday and while some trends continued, others slightly veered off course. Jobless claims were up, consumer sentiment and retail sales for the auto industry were down, and the supply of used vehicles has finally reached a stable level. This week’s report also reported lower numbers of construction permits being requested, possibly due to the high prices of materials and labor. With states reopening and people returning to work, the auto industry is hopeful that supply, demand, and prices will continue to stabilize after experiencing the brutal effects of the pandemic. Read more

Amazon leads the way with commitment to 14 more renewable energy projects
Amazon has announced 14 new projects using renewable energy to offset and/or reduce their emissions.  The projects are spread across locations in the US, Canada, Spain, and Finland with the objective to accelerate the fulfillment of The Climate Pledge ahead of schedule. It positions Amazon as the world’s largest corporate buyer of renewable energy. The projects mainly include wind and solar energy in the American Midwest as well as a solar farm in Alberta, Canada. A fifth solar project in Spain as well as their first Finnish project – a wind farm – round out the plans. Read more