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News Link • Transportation

Automakers Stuff Fleet Channels Amid Showroom Demand Collapse

•, By Tyler Durden

They are often times where automakers can bolster numbers that would otherwise looks dismal based only on organic, showroom sales. And according to Bloomberg, this is exactly what has been happening over the last couple of months.

Rental car deliveries and other non-retail buyers have accounted for more than 33% of total sales last month for Ford and Nissan, according to data from Cox automotive. In fact, deliveries to rental companies alone in March and in the first quarter were the highest that they've been in two years.

There is, of course, a catch: rental car sales have lower profit margins and generally erode used vehicle prices once they hit the resale market. It seems as though automakers are now, more than in the past few years, leaning on fleet deliveries to make up for demand in the showroom as economic growth in the US and worldwide, is collapsing. 

Zohaib Rahim, manager of economics and industry insights at Cox, told Bloomberg: "Any favorable view we have of the market is because of sales into fleets. The market peak of 2016 is behind us and retail sales are softening more and more now."

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