GM's Q2 sales are in, and it appears things are on the up.
GM has announced the impact of a decline in demand in its Q2 sales report, but despite suffering like many other automakers, things haven't been as bad as you may expect. Some manufacturers are even seeing an increase in demand, with the likes of BMW receiving a torrent of orders for electric vehicles. For GM, it's SUVs that have been propping business up, with the likes of the Chevrolet Trailblazer and Buick Encore GX doing remarkably well. According to GM, the Camaro-like Blazer's sales have increased 68 percent year on year for the second quarter of 2020 too.
Naturally, there is some bad news. Retail sales dropped 24 percent, although this is in line with the rest of the industry, with April seeing a drop of 35 percent. However, May and June saw the start of a recovery as sales were only down around 20 percent or less year on year. With most plants beginning to increase output, GM is taking the opportunity to maximize production by working through the traditional two-week summer shutdown. The company will also begin restocking its retail outlets, something made easier by a drop in rental demand. As stay-at-home orders start expiring, demand in the retail sector is expected to increase further.
GM Chief Economist Elaine Buckberg says: "We expect continued sales recovery as businesses ramp back up, but recognize that the path forward may not be linear, as rising infections in many states may lead to steps backward in the reopening process." Whatever happens next, it seems that GM is in a position of strength and should be able to handle the effects of the past few months with relative ease. This should allow the release of the new Tahoe and Suburban, while GMC's new Yukon and Yukon XL, and Cadillac's latest Escalade should also arrive shortly. With demand increasing, the timing seems just right.