Raise your hand if you have driven your car 20 or more times in the past week. With the onset of COVID-19, most people have been ordered to shelter in place and only to leave the house for essential items. Car dealerships and buying cars are unfortunately not a part of those essential items. A couple of weeks ago, the Wall Street Journal published an article on 3.18.20 called, “Auto Makers Slow Production as Coronavirus Dents Sales.” This article highlights the stark changes that are occurring in the car industry. Car companies are forced to hand out promotions and to advertise interest- free loans to their customers to procure more business. All across the world sales have been decreasing as markets in China and Europe have had to close due to COVID-19. Rhett Ricart, a member of the National Automobile Dealers Association, reported from a meeting that there has been a 25-50% drop in automobile showroom attendance. Another person from RBC Capital Markets said that vehicle sales could drop to 13.5 million which would be an all-time record low since 2010. Volkswagen in the Seattle area reported that sales fell down 30% and if these trends increased that they will have to shut down. Lots of different car companies are trying to work with this changing coronavirus. Hyundai has implemented a policy that they used in the recession by paying up to 6 months on car payments if the new owner loses their job unexpectantly. If this coronavirus did not happen, car analysts predicted that sales would continue to rise and would be on track to set the record for the 5thyear in a row.
This article connects explicitly to class because automobiles is my final project topic of the year. It also shows that businesses and stakeholders are an integrative system, as some car companies are adjusting to better fit their customer’s needs. In my opinion, I think this is devastating for the car industry and there will be lots of vehicles just sitting in storerooms. I also believe that lots of people will lose their jobs because factories are closing, and people don’t need to purchase cars. Hopefully, when this coronavirus dies down, car sales will go up. My question to the class is, what other promotional tools would you need to see car companies displaying for you to purchase a car? Would you feel comfortable buying a vehicle online? Why or why not?
Colias, B. F. and M. (2020, March 18). Auto makers slow production as coronavirus dents sales. Wall Street Journal. https://www.wsj.com/articles/coronavirus-threatens-auto-industrys-record-run-of-robust-sales-11584532801