Coronavirus pain for US automakers likely to worsen in near future, experts say

Coronavirus pain for US automakers likely to worsen in near future, experts say

U.S. automakers are just starting to feel impacts from the coronavirus pandemic, but experts say the worst days for consumer vehicle demand and supply chains lie ahead.

Ford Motor Co., General Motors Co. and Fiat Chrysler Automobiles NV announced March 18 that they are temporarily halting production in North America to combat the spread of the virus after the United Auto Workers Union urged the three automakers to suspend operations. Tesla Inc. announced March 19 that it would suspend production at its Fremont, Calif., factory beginning at the end of day March 23. Experts say it could take months to ramp back up to normal production.

Meanwhile, supply chain disruptions from plant closures in China, Europe and domestically will soon hit U.S. automakers as they burn through any lingering materials. And the widespread consumer pullback from business closures and government pleas to stay home will curtail demand for new vehicles, though it is unclear just how bad the drop will be, experts said.

The impact on vehicle sales will be “massive,” according to Charlie Chesbrough, Cox Automotive’s senior director of industry insights and senior economist.”At this point, it is difficult to identify where a bottom may be, but clearly the willingness to buy a vehicle, and the ability to buy a vehicle — two critical components in the market — have changed…

Continue https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/coronavirus-pain-for-us-automakers-likely-to-worsen-in-near-future-experts-say-57648159

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