How will the automotive industry recover from Covid-19?

The corporate crisis has an impact on communication, around the world what we see is a lot of dynamic developments in various economies driven by the progression of the disease as well as the actions of multiple governments. As far as economic projections are concerned about the challenges that cope, it has sort of brought about in Europe in the United States and in many of the emerging markets are very severe. This is something that is far from over.

Estimating the extent of the damage

We are still at the beginning of this crisis; the intensity of the global economic disruption depends on when and how long different regions will take measures to contain the disease. The European Union is relatively close to reaching a plateau. Hence, it is possible to believe that at some point we would see specific reductions in the number of new infections also and the number of people that die due to this disease as we move through the high point of this disease and infection in Spain in Italy and other places in the US.

The impact on the automotive industry

The unfortunate thing for the automotive industry is that it went into this crisis already under the risk what can be called as a perfect storm happening in the automotive industry, we have had the diesel issue, significant investments in electrification in autonomy and connected vehicles. There is an evident change in business models moving away from vehicle ownership to shared concepts we still have to evaluate the impact of the crisis on this kind of shared thoughts. Businesses are seeing stagnating markets in many parts of the world, in fact, declining markets after an unprecedented expansion and that cocktail of negative influences have driven the automotive industry already into a situation where it was under stress. Now on top of this, there is a massive disruption, and this is happening on the supply chain supplied for a side as well as the demand side.  On the supply side, the fact that within automotive, there are highly integrated global supply chains that are incredibly efficient.

Gaps in society

Car purchases go down in terms of odd or during times when the overall economy is not doing that well there may be some niches that are not quite as affected are typically what you see is that for example luxury purchases may still happen because that segment of society is really not that vulnerable to economic shocks but here what is happening is we don’t have a financial collapse as such we have a medical shop. This medical shock applies to everybody as everybody can get sick. there is

Conclusion

There is a significant reduction in willingness to buy there’s substantial uncertainty in consumers. If you’re under lockdown, you don’t even have an opportunity to go see a car and then finally end up buying that vehicle. The profit pool of the overall industry depends heavily on Chinese demand, and Chinese market already has been hit, so the risk for the automotive industry from a supply chain and the supply side and the demand side is exceptionally high.