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What's Next For The Automotive Industry?

March 18, 2020, 12:00 am

The recent health crisis is going to affect everyone, but it’s already hit the automotive industry with force. 

Daily life has been changed over the past few weeks, and as families wait to see what happens next, some of the most important elements of the economy are also fighting to deal with uncertainty. The automotive industry has always been the lifeblood of the American economy, and while US automakers have been on the rebound for the past decade, their position is more precarious than many other sectors. 

Inevitably, it’s the workers most affected. A recent study examined the impact closures and slow sales have had in Italy, home to luxury car brands like Lamborghini and Ferrari, as well as information from the 2009 recession. Including more recent trends, the forecast is bleak. Experts say that the US could lose over $7 billion per week for as long as these sales slow. Even worse, the Big 3 manufacturers could shed as many 94,000 jobs every single week. 

In the longer term, experts predict that demand for new vehicles could drop by nearly 2 million. Sales are also to be heavily hit in other coronavirus-hit regions like China and Italy. It may be those areas that show just how quickly economies can rebound. In China, factories are slowly gearing up production to pre-pandemic levels, though officials are still wary of relapse and are tempering expectations of a fast, effective recovery. 

Lower interest rates could help those with secure financial positions buy new cars, but consumer confidence is understandably shaken. Like so many of us, what comes next for the automotive industry is very much in a wait-and-see pattern.

 

Posted by Garfield Auto at 12:00 am
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