As 2020 comes to a close, it has been a wildly different year for all, quite unlike what anyone had expected. At the beginning of the year, the Canadian Black Book team had projected that 2020 would yield small declines in new and used vehicle sales, along with a slow softening of wholesale prices. We also expected a record year for lease returns and as a result a small boom in market supply for used vehicles. Some estimates forecasted a 25 per cent chance of a U.S. recession, while there was less certainty around the chance of that happening here in Canada.
Instead, what the auto industry has ended up with is the largest decline in new vehicles sales since the Second World War. To facilitate that, the economy witnessed the largest increase in unemployment ever recorded with modern data, a huge retraction in GDP growth, all followed by equally spectacular rebounds, across many sectors. A roller-coaster or perhaps a pandemic bungy jump into the unknown may begin to describe the volatility of 2020.
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