Auto Industry maybe the one to watch out for in a Post Pandemic World..
News emerging out of China seems to suggest that the Auto Industry maybe one of the positive stories in a Post Covid World.
Limited Inventory: With Production lines coming to a Standstill across the world, it will take some time for daily output to go back to normal levels. Managements will not rush to go back to the same levels, preferring to watch how things play out in terms of demand. Also with the lives of migrant workers who make most of the force in these factories severely disrupted, with many of them unwilling to come back, there will be manpower issues too. This will result in certain models and colors in short supply seeing a price hike. This is likely to play out for both new and used car markets.
Unrequited Demand and new segments While there will be a drop off from customers who couldn’t fulfill their car purchase due to the lockdown and now wish to conserve money, a significant set will still want to go ahead with their purchase. They will be joined by a new segment unwilling to use public or shared transportation. Expect current two wheeler owners to speed up upgrade to car purchase. The Industry will have to now make giant leaps to going 100% online in terms of car sales as the current mostly offline model will not be sustainable. Virtual Tours, Pricing discussions over Video calls, Car Sanitation, Contactless Home deliveries will come into vogue. Dealers will need to go online- pure offline models will find it difficult to survive. Opportunities exist to aggregate and structure this market for online car portals. Right now, online car portals can drive the messaging to push the Industry in this direction. With everyone spending significant time online, targeted messaging on online sales, safety/sanitation and car as a family requirement will yield dividends. Even something a basic as email or direct marketing around this will grab attention. With timely actions, they can create significant disruption in how people purchase cars in a Post Covid era.