The Impact of Corona Virus on the Automotive Industry


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The Coronavirus (covid-19) outbreak is affecting all kinds of businesses on a global scale and the Motor Industry has not been exempt from this.

  • Car sales in China fell 92% in the first half of February.
  • Several major car brands have launched new models exclusively online after the Geneva Motor Show was cancelled
  • Jaguar Land Rover reported that they flew parts in suitcases to meet demand because the Chinese shutdown was affecting their supply.
  • Only 6.2m light vehicles were sold globally in January 2020, the lowest reported figure since the financial crisis in 2012.

With the worst of the outbreak in the UK yet to come, it is unclear exactly how hard the UK Motor Trade will be hit however, it is highly likely that there will be a significant impact as a knock on effect of the shut down in China.

Many Chinese factories still remain closed as a large proportion of their employees are in quarantine and this is affecting supply chains. Typically, most Automotive businesses wouldn’t be prepared for such dramatic supply chain shortages as they don’t hold large amounts of stock, they order specific parts as and when required.

It is predicted that if factories remain closed until the end of March it could lead to reduction of 1.7 million vehicle production in China which will no doubt have implications on the wider global market further down the line.

Fortunately, it’s not all doom and gloom, with many automotive business using innovative solutions to combat the drop in sales. Volkswagen, Nissan, and BMW are among the businesses that have utilised online car shopping. They’ve been using tools including virtual reality and live broadcasts to stimulate sales while the virus keeps potential buyers out of their showrooms.

The same was true when it came to the Geneva Motor Show being cancelled. Instead, many car manufacturers unveiled their new models online and it seems that UK car retailers were able to drive their March sales as normal.

As businesses are directing their resources into online marketing options as well as improving their e-commerce outlets, it gives an insight into the future of car sales as digitalisation becomes more popular.

It’s yet unknown how severe the outbreak will be in the UK and in the meantime businesses are urged to take the recommended precautions with their staff, the latest of which can be found here.

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