Covid - 19 impact on Automotive Sector.

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Covid - 19 Impact on Automotive Sector




Uncertainty clouds are hovering over the automotive industry and therefore the coming months are expected to unleash a bunch of challenges to organisation connected to the automotive sector. According to industry experts, the future is filled with challenges amid a large tide of unprecedented waves hitting the automotive shores.

The COVID-19 happening has exposed many challenges for the automotive sector. South Korea, Italy and Japan are the foremost affected among the main industrialised economies. Consequently, 80 % of automotive and connected companies report that Coronavirus can have an immediate impact on their 2020 revenues. 78 % of organisations do not have enough employees to run a full production and assembly line.

However, over 80 % of the world’s auto supply chain is connected to China. In January 2020 China’s car sales plunged by 18 %. The China Passenger Car Association (CPCA) considers that the primary two-month sales might decline by 40 % or more compared to the same period in 2019. Production shortfalls resulting from supply chain disruptions in China can impact world automakers. [1]

In the automotive market, the life of customers revolves around pure economics. Automotive market thrives on a differentiated segment of consumers. These are those who drive demand and bring huge incremental sales and growth. It’s the category of businessmen, traders or entrepreneurs that usually drive sales. However, in today's situation, this is often the category that is the worst affected set of consumers that are trying to preserve their resources. Amidst the current scenario of a downtrend and uncertainty, automobile industry may therefore face difficulty in converting purchase decision into sales.

The COVID-19 pandemic has made one thing clear, every automobile manufacturer is going to face a crisis and it may take time to overcome from this. Now is the time to think about new strategies and action plans for an uptrend in sales when operations resume. One of the most critical factors of a company’s long-term outlook is the responsibility of leadership, and this situation is going to challenge leaders now more than ever.





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