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How coronavirus has impacted the car industry

When we look at how coronavirus has impacted the car industry it’s clear that there are some big challenges ahead.  With over 6,000 jobs being lost in the automotive sector in June alone, even the reopening of car showrooms might not be enough to save thousands more. 

Coronavirus lockdown was a disaster for the car industry

No sector of the UK economy was prepared for a global pandemic and lockdown, but to understand how coronavirus has impacted the car industry you only need look at some figures:

– Car manufacturing in April almost completely ground to a halt, with a fall of 99.7% on the previous year.
– Loss of revenue for the automotive sector in 2020 expected to be around £12.5bn in Britain
– Car engine manufacture also dropped by 99.5%

The picture, however, is starting to improve worldwide, with China, for example, likely to recover the quickest due to its focus on electric vehicles and robust response to Covid-19. Even then, it’s expecting a 44% fall in revenue compared to the same period in 2019. 

Car industry calls for more government help

Although Chancellor Rishi Sunak announced another rescue package of £300bn on July 8th, the Society of Motor Manufacturers and Traders (SMMT) chief executive Mike Hawes said that the help for the automotive sector was disappointing. 

He’s disappointed that Britain is the only one of Europe’s top five economies failing to provide dedicated support to the car industry – a decision that he feels will slow recovery of such a critical sector.

He went on to say, “We urgently need government to expand its strategy and introduce sector specific measures for UK auto to support cash flow such as business rate holidays, tax cuts, and policies that provide broader support for consumer confidence and boost the bi ticket spending that drives manufacturing.”

With many UK workers still furloughed while manufacturing plants work out the safest way to return to work and maintain social distancing guidelines, there’s a real fear that they will be returning to redundancies rather than full-time employment.

Our hope at Trafalgar Street car park is that covid-19 is now under control and life can begin to get back to normal for the automotive sector and all other areas of the economy. We remain optimistic that despite this sobering view of how coronavirus has impacted the car industry, we can all move forward with confidence.