Impact of COVID-19 on the Automotive Sector

By | April 7, 2020

Coronavirus is fast spreading its tentacles affecting every aspect of society, including the automotive sector. The World Health Organization has already declared COVID -19 outbreak a pandemic. The sales of the vehicles dropping down dramatically. Unprecedented consumer footfalls in showrooms have fallen drastically. Events such as the 2020 Geneva Motor show which was to open on March 5 has been canceled. In light of coronavirus pandemic, Detroit Motor show announced a refund of purchased tickets. Paris motor show has been canceled.

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COVID-19 and Automotive Sector in North America

In the wake of the coronavirus outbreak, Nissan Motor declared to remain close through late April to reduce the spread of COVID-19 and protect employees. Mitsubishi Motors Corporation suspended production temporarily three plants in Japan. According to data from Ward’s shows, there is a sharp drop in sales of light vehicles due to lockdown measures and social distancing. According to Global Data forecasts, the next few months are expected to be weak but a strong pickup is expected in the third quarter forecast as economic activity returns. On 1st April, Nexteer Automotive announced to donate plastic masks and face shield bands to nearby medical facilities. Ford has put no date on a future restart of vehicle production in its North America plant.

COVID-19 Effect on the Automotive Industry in Europe

EU-wide production losses due to 16 working days shutdowns amount to at least 1,231,038 motor vehicles so far and are expected to increase if shutdowns are extended.

“We have Decided to Extend our Support to the Industry on Account of Corona Outbreak by Offering Flat Discount 30% on All Our Studies and Evaluation of the Market Dynamics in Automotive Industry Amidst COVID-19.”

A Ray of Hope 

After an extended lockdown, China’s factories are coming back to life bringing hope to several Indian carmakers that have their supply chains located in China. The supply of auto-component has resumed at the nick of the moment when the Indian industry is seeking to transition into stricter emission norms leapfrogging from stage IV to VI in the next fiscal year.

How COVID-19 Impacted the Automotive Industry Around the World

The automaker Ford has partnered with GE Healthcare to expand the production of a simplified version of the existing ventilator design of GE Healthcare. It is working with 3M and developing powered air purifier respirators and working on a new design leveraging components from both companies. It has also developed a full-face shield that is paired with N95 respirators to provide additional protection to the healthcare givers.

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Tata Trusts has set aside Rs 500 crore to empower and protect affected communities from the COVID-19 outbreak.

Maruti Suzuki India has collaborated with AgVa Healthcare for producing up to 10,000 ventilators per month.

The TVS Motor Company announced an economic aid package of Rs 30 crore and the Hyundai Motors India Foundation ordered diagnostic testing kits for COVID-19 from South Korea. 

Marcedes Benz India has announced to set up a temporary hospital in Pune, with 1500 -bed isolation ward for COVID patients whereas Audi announced an extension for all its customers whose service package or extended warranty ends during the lockdown period.

Hero Group has contributed Rs 100 crore as an aid for the ongoing COVID -19 relief efforts in India.

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