To get a sense of how often yo-yo sales happen, NPR sent a survey to consumer attorneys who work on auto cases. Forty of them responded. Together, those few dozen lawyers said they've gotten calls from nearly 900 car buyers in just the past year who say they felt victimized by a yo-yo car sale.
And to get you to buy the car, the sales person might agree to a monthly payment that's too low. Or for whatever reason, they can't find an auto lender willing to essentially buy your car loan, at least at a price the dealer is willing to take.
In those instances, he says, the salesperson knows the deal is too good to be true, but lets you think you've bought the car anyway. So you take it home, show it to your friends and family. Then a few days or weeks later you get the phone call yanking you back like a yo-yo.
NPR obtained and analyzed data made up of complaints to the Maryland attorney general's office. In the three years prior to the new law, there were 122 complaints related to yo-yo car sales, or "spot-delivery" sales as the industry calls them. But now, in the three years ending in 2022, complaints have fallen by more than half.
But Paul Metrey with the National Automobile Dealers Association says the FTC doesn't need to change the rules at the federal level. He says the vast majority of car sales go through with no incident. "You have tens of millions of transactions where this happens all the time," Metrey says, even when the sales contract gives the dealer the right to cancel it later.
So he says there's nothing wrong with contracts that give dealers the right to cancel after the fact. He says he doesn't have data on problems with yo-yo sales but that it seems to him that it's rare that the original terms don't work and a car buyer needs to be called back.
Kaitlyn Arland is an Army service member stationed at Fort Riley in Kansas. When she bought a car two years ago, she says the salesman didn't say anything about the sale not being final as she drove away. But then she received a call from the dealership. Arin Yoon for NPR hide caption
She says the salesman didn't say anything about the sale not being final as she drove away. But then, eight days later, came the yo-yo phone call. She says the dealer told her the financing didn't work out, she had to come back, sign a different contract, and make a $2,000 down payment.
The police returned the car to the dealership. AutoNation said in a statement to NPR that the sale had a "stipulation" that Flynt would provide a copy of his Social Security card the next day and that he did not. Flynt and his attorney both say that's not true, that there was no stipulation about a Social Security card and that it's not mentioned in the sales contract Flynt signed.
"Once the customer signs the paperwork and we sign the paperwork, that's a contract ... it's done," says Scott Addison, the head of sales at Fitzgerald Auto Mall, which operates 23 dealership locations in Maryland, Pennsylvania and Florida.
For their part, Courtney and Darren Johnson in Florida managed to find a lawyer who took their case, which ended up in arbitration as is required in many sales contracts. But it turns out suing a car dealership can be perilous.
That's a big reason he'd like to see the FTC craft a rule that directly addresses spot-delivery and yo-yo sales. "Having some bright line rules," he says, would make the buying process more transparent for buyers and "would make the law much easier to understand and interpret and enforce."
As the Covid-19 pandemic unfolded in early 2020 and lockdowns were implemented in countries around the world, global car sales experienced an unprecedented drop. Despite gradual recovery over the course of the year, early market data suggests that global car sales contracted in 2020 by an estimated 14% year-on-year, mirroring closely the IEA estimate of 15%. The drop in global car sales in 2020 was significantly larger than the one observed during the global financial crisis of 2007-2009.
As the pandemic began to surge in early 2020, there was a general expectation that electric car markets would likely be more resilient than the general automotive sector although a drop in electric car sales was generally expected nonetheless, albeit a smaller one than overall car sales. The IEA estimated a slight increase in global electric car sales despite the pandemic, and suggested that this could be higher if additional stimulus measures were taken.
Electric car sales in 2020 exceeded these expectations. Backed by existing policy support and additional stimulus measures, the IEA preliminary estimate is that electric car sales worldwide climbed to over 3 million and reached a market share of over 4%, making 2020 a record-breaking year for electric mobility. This is equivalent to a growth of over 40% in global sales from the 2.1 million electric cars sold in 2019, and marks a return to the two-digit growth rates observed in the period 2010-2018. As a result, there are today more than 10 million electric cars on the road globally. While impressive, the share of electric vehicles in total car sales is still only one-tenth that of conventional SUV sales.
Over the first half of 2020, global electric car sales were on average 15% lower than over the same period in 2019. The notable exception was Europe where electric car sales were 55% higher on the back of existing policy support schemes.
Global market trends were markedly different in the second half of 2020, when lockdowns were lifted or relaxed for some time, and the automotive market started to recover. For electric cars, monthly sales surpassed those between July and December in 2019 in every month in all large markets including China, the European Union, India, Korea, the United Kingdom and the United States, despite second waves of the pandemic.
The result for the entire year was that electric car sales in Europe more than doubled over 2019 levels: many of its large markets such as France, Italy, Germany and the United Kingdom actually had significantly higher electric car sales than in 2019 throughout almost each month of 2020. In China, electric car sales were 12% higher year-on-year. Both in Europe and China, electric car sales reached about 1.3 million in 2020, which translates into a share of electric cars in total sales of about 10% in 2020 in Europe, and 5% in China. In the United States, despite a lack of EV stimulus measures at the federal level, electric car sales were 4% higher than in 2019 in a car market that shrank by 15%. This suggests that car buyers have a continued attraction to electric cars. In Canada, too, electric car sales dropped less than the overall market. Japan and Australia are the only major markets where electric car sales dropped more than overall car sales in 2020.
At the beginning of 2020, the European Union, China and the US state of California already had strong regulatory measures in place, such as tailpipe emissions regulations or EV mandates, with the objective to drive OEMs to diversify their sales away from conventional vehicles and towards electrified powertrains. At the same time, direct electric car purchase subsidies decreased or were terminated in China and at the federal level in the United States over 2019-2020, while significant additional incentives were implemented in markets such as Germany, Italy and Korea. The additional Covid-19 stimulus measures that were implemented from the summer of 2020 by several governments around the world then provided an additional boost. The primary measure was financial incentives to support the purchase of electric vehicles.
In the United States, the stimulus measures and longer-term goals adopted by the new administration will be critical guides for electric vehicle markets. But the resilience of electric car sales in 2020, despite the Covid-19 crisis, together with the planned release of new popular electric car models in 2021 and the increased state support for electric cars in spite of a degrading policy support environment at the federal level already fuel optimistic sales forecasts for the next few years. There are also early signals that the new US administration could prioritise fuel economy standards, promote charging station deployment, provide tax credits and help factories making internal combustion engine cars retool to make electric vehicles.
To achieve the long-term goals for clean energy transitions, it is critical that rapid EV deployment growth be sustained throughout the decade. The fact that sales of conventional sport-utility vehicles kept rising in 2020 despite the pandemic clearly signals the need for strong and targeted transport decarbonisation policies. Recovery packages that have a continued focus on electric mobility offer an opportunity to accelerate the pace of transition. As we enter this new decade, policy measures should encompass a broad set of considerations. These include equity (e.g by applying revenue-conditions or vehicle retail price-conditions, or by providing zero-interest loans), environmental performance standards (providing stimulus proportional to the emission reductions that a given car model delivers) and long-term viability with a view to revenue-neutrality (e.g. through differentiated taxation or bonus-malus systems). Regulatory instruments should continue to encourage sustainable and low-emission technology investments (considering all lifecyle stages of the product), while supporting and prioritising industry reskilling towards low-carbon economic activities with high employment multipliers, including non-motorised transport infrastructure and battery manufacturing.
This commentary is based on preliminary data for electric light-duty vehicle sales in 2020. IEA final electric vehicle market data for 2020 will be released in spring 2021, based on submissions by the member governments of the Electric Vehicles Initiative, as part of the Global EV Outlook 2021 publication (The Global EV Outlook 2020 report available here). 041b061a72