The COVID-19 pandemic has impacted nearly every industry in a big way. While there are some clear winners and losers, the Automotive industry is still existing in a grey area. We explore how the industry has already been affected and look forward to make some educated guesses on how this economic disturbance could have a lasting impact on the automotive industry at large.
The COVID-19 pandemic has already impacted nearly every industry in a big way. While some industries have seen a boom in consumer spending (think toilet paper, groceries, and delivery services), others, like travel and entertainment, have been totally crippled by the economic shutdown with many companies closing for good.
Thus far, the impact on the automotive industry has been less clear. We have received mixed reports from the Dealers we work with, some have had to furlough employees while others have experienced a rush/increase in business, however, no complete stagnation. Most people are avoiding air travel during this time which may explain the consistent demand for automobile sales and service. While manufacturer production cuts will inevitably have an impact on dealers, service, and parts departments can help stabilize dealerships’ means of profit control. In many parts of the country, workers have already gone back to manufacturing positions.
Looking to the future: while we expect the industry to be constrained and slowed, the demand for personal transportation is likely to still exist- if not be increased. People wanting cars and needing service is all but a given, but the real question is how? We suspect the post-COVID industry to be an accelerated version of the digital car-buying trend we’ve observed the past few years. Dealerships are likely to offer fewer in-person sales reps and more online buying options. With this decrease in customer facetime during the sales process, the parts and service department now becomes the new face of the dealership. If it goes in this direction, it will be more important than ever to develop customer relationships through great service in your service department.
How do you think COVID-19 will change the automotive industry? Leave a comment below!
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